Supriya Lifescience Limited, a manufacturer and suppliers of active pharmaceutical ingredients (APIs) that go into medicines, with a strong focus on research and development, will open its initial public offering (IPO) on Thursday, December 16.
Here are 10 key things to know before subscribing to the IPO:
1. IPO dates
The offer opens on December 16 and will close on December 20.
2. Price band
The offer price has been fixed at Rs 265 – 274 per equity share of Rs 2 each.
3. Offer details
The company plans to raise Rs 700 crore through this public offer, which consists of a fresh issuance of shares worth Rs 200 crore and an offer for sale of Rs 500 crore by promoter Satish Waman Wagh.
Of the total offer size, 75 percent is reserved for qualified institutional buyers, 10 percent for retail investors, and the remaining 15 percent for non-institutional investors.
The anchor book, if any, will open for bidding on December 15.
The promoter and promoter group currently holds 99.98 percent equity in the company which will come down to 67.59 percent after the IPO.
4. Objectives of the IPO
The company will utilise proceeds from the fresh issue to meet capital expenditure requirements to the tune of Rs 92.3 crore, and repaying debts of about Rs 60 crore, besides other general corporate purposes.
5. Lot size
Investors can bid for a minimum of 54 equity shares and in multiples of 54 shares thereafter. Retail investors can invest a minimum of Rs 14,796 for one lot, and their maximum investment is Rs 1,92,348 for 13 lots.
6. Company profile
Incorporated in 2008, Supriya Lifescience has niche product offerings of 38 APIs focused on diverse therapeutic segments such as antihistamine, analgesic, anaesthetic, vitamin, anti-asthmatic and anti-allergic drugs. It has been the largest exporter of chlorpheniramine maleate and ketamine hydrochloride from India. The company was among the largest exporters of salbutamol sulphate contributing to 31% of the API exports from India in FY 2021 in volume terms.
Chlorpheniramine is an antihistamine used to relieve symptoms of allergy, hay fever, and the common cold. Ketamine hydrochloride is used as a sedative for diagnostic and surgical procedures. Salbutamol sulphate is used to treat wheezing and shortness of breath.
Supriya Lifescience’s products are registered with various international regulatory authorities such as the United States Food and Drug Administration and the European Directorate for the Quality of Medicines & HealthCare.
As of October 31 2021, its products were exported to 1,296 customers in 86 countries through a network of 346 distributors.
The company’s business operations are supported by a modern manufacturing facility located in Parshuram Lote, Maharashtra, spread across 23,806 sq meters.
The global pharmaceutical market has grown at a compound annual growth rate of 4.8 percent from ~$955 billion in CY14 to ~$ 1,270 billion in CY20. It is expected to sustain this growth over the next five years to reach $1,585-$1,625 billion in CY25. The key growth drivers include new product launches, widespread population aging and sedentary lifestyles leading to increased chronic disease prevalence.
7. Financials
The company has consistently recorded growth in net profit for the last three financial years. It registered revenue and net profit CAGR of 17.7% and 77.2% over FY2019-21.
For FY19, it registered a net profit of Rs 39.4 crore on revenue of Rs 285.9 crore. In FY2020, the profit increased to Rs 73.4 crore while revenues increased to Rs 322.7 crore. The company’s net profit improved in FY2021 to Rs 123.8 crore and revenue jumped to Rs 396.2 crore.
For the first half of FY22 ended on September 30, it earned a net profit of Rs. 65.96 crore on revenue of Rs. 230.06 crore.
8. Strengths & business strategy
The company enjoys a leadership position with significant scale across key niche products. Its backward integration of APIs ensures a steady supply of intermediates. It has a presence across 78 countries backed by advanced manufacturing and research & development capabilities, which ensures consistently strong financial performance.
The company intends to expand its manufacturing capabilities and enhance its product portfolio by strengthening its R&D capacity so that it is able to increase its current market presence and enter new markets.
9. Promoters and management
Satish Waman Wagh is the promoter, chairman and managing director of the company. Smita Satish Wagh, Saloni Satish Wagh, Shivani Satish Wagh and Balasaheb Gulabrao Sawant are the whole-time directors of the company.
Kedar Shankar Karmarkar, Bhairav Manojbhai Chokshi, Dileep Kumar Jain, Dinesh Navnitlal Modi and Neelam Yashpal Arora are independent directors.
Shireesh Bhalchandra Ambhaikar is the chief executive officer and Ashish Ramdas Nayak is the chief financial officer. Shweta Shivdhari Singh is the company secretary and compliance officer.
10. Grey market, allotment and listing dates
The company’s shares are currently commanding a premium of Rs 250 per share in the grey market, according to IPO Watch.
The allotment of shares will be decided by December 23, unsuccessful investors will get refunds by December 24 and successful bidders will get shares credited to their demat accounts by December 27.
Shares of Supriya Lifescience Ltd will list on the BSE and the National Stock Exchange on December 28.
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