In what could be the biggest IPO of this year, Mankind Pharma on Wednesday set a price band of Rs 1,026-1,080 for the offering. The fourth-largest pharmaceutical firm in the country aims to raise Rs 4,326 crore at the upper end of the price band, at a $5.26-billion valuation.
This is the third public offering of the year and the first for FY24. The IPO is set to open on April 25 and will run till April 27. This will completely be an offer for sale, with the entire proceeds going to shareholders who are divesting.
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“While equity capital markets have been volatile over the past few months, there continues to be strong interest in high-quality, scaled-up assets. Mankind Pharma is largely a domestic-focused company with strong fundamentals, and has shown consistent growth over time,” said Nipun Goel, president — head investment banking, IIFL Securities, one of the lead managers to the issue.
According to the red herring prospectus (RHP), promoters Ramesh Juneja, Rajeev Juneja and Sheetal Arora are selling 3,705,443 shares, 3,505,149 shares and 2,804,119 shares, respectively, translating to 2.5% of the total equity share capital. Shares sold by investors amount to 7.5% of equity share capital.
Juneja said the company has decided to hit the markets to give the investors an exit. The selling investors are Cairnhill CIPEF, Cairnhill CGPE, Beige Limited, and Link Investment Trust.
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Kotak Mahindra Capital, Axis Capital, IIFL Securities, Jefferies, and JP Morgan are the book-running lead managers to the issue, while KFin Technologies is the registrar, according to the RHP.
Mankind Pharma, known for consumer healthcare brands like Manforce, Prega News, Unwanted-72, and Acne Star, is a largely domestic-focused firm with 97% revenues from India and 75% production in-house, said the MD.
Juneja said the response to its Covid-19 drug Molulife was not great, and the company has no strategy to ramp up sales. The company, however, said it had registered a significant growth in the chronic segment.
Another banker, who did not wish to be named, said this could be the biggest IPO of the year, which could set a trend. “While large IPOs of previous years did not generate satisfying returns, Mankind’s IPO has created great interest in the market and could revive the IPO market,” the banker added.