The public offer of Windlas Biotech, the pharmaceutical formulations contract development and manufacturing organizations, is subscribed 22.47 times so far, garnering bids for 13.78 crore equity shares against the IPO size of 61.36 lakh equity shares, the subscription data available on exchanges showed on August 6, the final day of bidding.
The qualified institutional buyers have to put in bids 24.4 times their reserved portion. The portion set aside for non-institutional investors is subscribed 15.73 times, while the retail portion has seen a 24.27 times subscription.
Windlas Biotech is planning to mobilise Rs 401.53 crore through its maiden public offer. Of which, it already raised Rs 120.46 crore from anchor investors on August 3, a day before issue opening. The net proceeds from its fresh issue of Rs 165 crore will be utilised for purchase of equipment required for capacity expansion of existing facility at Dehradun Plant – IV, addition of injectables dosage capability at existing facility at Dehradun Plant-II; working capital requirements; and repayment of borrowings.
Incorporated in 2001, Windlas Biotech offers a range of contract development and manufacturing organization (CDMO) services from product discovery to product development, licensing, and commercial manufacturing of generic products including complex generics.
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It further sells its own branded products in the trade generics and over-the-counter (OTC) markets. Currently, the focus of the company is to launch complex generic products in the chronic therapeutic category related to lifestyle-related disorders.
"Its innovative portfolio of complex generic products supported by robust research & development (R&D) capabilities, efficient and quality compliant manufacturing facilities with significant entry barriers, long-term relationships with Indian pharmaceutical companies and a consistent track record of financial performance provide for further growth visibility," said BP Equities.
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On the valuation front, at the upper price band, the issue is aggressively priced at 64.4x P/E considering the diluted equity shares and FY21 annualized earnings, the brokerage feels. However, considering all the positive factors mentioned above, it has given a 'subscribe' rating on this issue for the long term.
Grey Market Premium
Investors in the grey market traded shares of Windlas Biotech at a premium of Rs 90-110, the IPO Watch and IPO Central data showed.
The trading price comes to Rs 550-570 per share, which is 19.6-23.9 percent higher compared to upper end of issue price band of Rs 460.Disclaimer: The views and investment tips expressed by investment expert on Moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.