Emcure Pharma IPO to open on July 3, Shark Namita Thapar likely to earn ₹127 crore
Emcure Pharma IPO to open on July 3, Shark Namita Thapar likely to earn ₹127 crore
The initial share sale of Pune-based Emcure Pharmaceuticals will open for public subscription on Wednesday, July 3. The three-day bidding process will conclude on July 5.
Ahead of the issue opening, shares of the company are commanding a premium of ₹290 in the unlisted market.
However, it is important to note that grey market premiums are just an indicator of how the company's shares are stacked up in the unlisted market and are subject to change rapidly.
The company will sell its shares in the range of ₹960 to ₹1,008 apiece, where investors can bid for 14 equity shares in one lot and in multiples thereof.
Considering the upper end of the price band, the company is looking to raise a total of ₹1,951 crore through the issue.
The public offer comprises a fresh share sale of ₹800 crore and an offer-for-sale (OFS) of 1.14 crore equity shares by its promoters and existing shareholders.
Shark Tank fame Namita Thapar is expected to get 293 times return from her initial investment after partially offloading her stake in Emcure Pharma, as per the company's red herring prospectus.
Thapar holds 63.39 lakh shares of Emcure Pharma, which represents a 3.5% stake in the company. The weighted average cost of acquisition for her shares is Rs 3.44.
The Shark Tank fame will sell 12.68 lakh Emcure shares in the OFS. The stake sale will get her almost ₹127 crore when the top price band of ₹1,008 is taken into consideration.
Other promoters like Satish Ramanlal Mehta, Sunil Rajanikant Mehta, and Samit Satish Mehta are also selling shareholders in the OFS.
Additionally, Pushpa Rajnikant Mehta, Bhavana Satish Mehta, Kamini Sunil Mehta, BC Investments IV, Arunkumar Purshotamlal Khanna, Berjis Minoo Desai, and Sonali Sanjay Mehta will also be offloading shares in the OFS.
About 50% of the issue has been reserved for the qualified institutional bidders (QIBs), while non-institutional investors will have 15% of the net offer. The rest 35% of the net offer shall be allocated towards retail investors.
The company has also reserved 1.08 lakh shares for the eligible employees of the company, who will get a discount of ₹90 per share.
Proceeds from the fresh issue will be used towards repayment and/or prepayment of all or a portion of certain outstanding borrowings availed by the company; and general corporate purposes. Additionally, proceeds from the OFS shall go to the selling shareholders.
Emcure Pharmaceuticals competes with Dr Reddy's Laboratories, Cipla, Alkem Laboratories, Torrent Pharmaceuticals, Mankind Pharma, Abbott India, and JB Chemicals.
Incorporated in 1981, Emcure Pharmaceuticals develops, manufactures, and globally markets a wide range of pharmaceutical products across several major therapeutic areas.
Emcure's revenue increased by 11.33% and profit after tax (PAT) dropped by -6.1% between the financial year ending with March 31, 2024 and March 31, 2023.
The company EBITDA or earnings before interest, tax, depreciation and amortisation rose 4% to Rs 1,229.7 crore but margin dropped 120 basis points to 18.5% for the last fiscal year (FY24).
Kotak Mahindra Capital Company, Axis Capital, JP Morgan India and Jefferies India are the book running lead managers to the issue, while Link Intime India is the registrar for the issue.
The equity shares of the company will be listed on both BSE and NSE with Wednesday, July 10 as the tentative date of listing.