Mankind Pharma has a pan-India marketing presence and operates 25 manufacturing facilities across the country
Mankind Pharma to List on NSE, BSE on Tuesday: Mankind Pharma’s initial public offering (IPO) was up for public subscription during April 25-27 and got a good response with an overall subscription at 15.32 times. The company’s listing is scheduled for tomorrow, Tuesday, May 09, 2023.
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Mankind Pharma IPO: Basic Details
Mankind Pharma is engaged in developing, manufacturing, and marketing a diverse range of pharmaceutical formulations across various acute and chronic therapeutic areas, as well as several consumer healthcare products.
It has established several differentiated brands in condoms, pregnancy detection, emergency contraceptives, antacid powders, vitamin and mineral supplements, and anti-acne preparation categories.
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It has a pan-India marketing presence and operates 25 manufacturing facilities across the country. As of December 2022, the company had a team of over 600 scientists and a dedicated in-house R&D centre with four units at IMT Manesar, Gurugram (Haryana) and Thane (Maharashtra).
The IPO was entirely an offer for sale (OFS) of 40.06 million equity shares by promoters and other existing shareholders. Its price band was fixed at Rs 1,026-1,080 per share. In the Rs 4,326-crore IPO, a bidder bid for a minimum of one lot and maximum of 13 lots. A lot had Mankind Pharma’s 13 shares.Mankind’s FY22 revenue grew 25 per cent, volume-driven (17ppts), price hikes (4 per cent ppts) and launches (4ppts), while 9M FY23 growth was 9 per cent. Lower GMs and high costs led to a 23 per cent EBITDA margin in 9M FY23 (FY22: 25.6 per cent). The 9M FY23 EPS slid 20 per cent y/y to Rs 25 (FY22: Rs 36). FCF was Rs 6.3 billion in 9M FY23 (vs a negative Rs 14.2 billion in FY22 due to acquisitions).
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Subscription Status
Mankind Pharma is the biggest IPO of the current financial year. The company has raised Rs 4326.35 crore through this IPO. This IPO got tremendous response from the investors. The IPO was subscribed more than 15 times. Out of this, the quota prescribed for Qualified Institutions was maximum subscribed 49.16 times, Non- Institutional Buyers’ quota 3.80 times and Retail Investors’ quota 0.92 times.
Mankind Pharma IPO GMP today
According to market observers, Mankind Pharma IPO GMP today is ₹103, which is Rs 3 higher from its yesterday’s GMP of ₹100. Market observers said that Mankind Pharma IPO GMP has surged today despite sell off in secondary markets on Friday because weakness on Dalal Street was mainly due to HDFC twins rebalancing by MSCI. Auto and some other stocks remained strong during HDFC twins fueled sell off. Probably, this has worked in favour of the Mankind Pharma IPO in grey market, they said.
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What this GMP mean?
Market observers maintained that Mankind Pharma IPO GMP today is ₹103, which means grey market is expecting that Mankind Pharma IPO listing price would be around ₹1183 ( ₹1080 + ₹103), which is around 9.50 per cent higher from Mankind Pharma IPO price band of ₹1026 to ₹1080 per equity share. So, the grey market is signaling that Mankind Pharma IPO will have a positive listing but it won’t be a whopping premium that a lucky allottee can expect from this Manforce and Prega News manufacturer company’s stock listing.
However, stock market experts maintained that grey market is not an ideal indicator about the expected listing premium as it involves even those who have high stake involved with the public issue. They also said that GMP is completely speculative and it is non regulated. So, sometimes GMP of an IPO given artificial appreciation or depreciation as well. So, one should stick to the basics and scan balance sheet and financial details of the company as it gives concrete fundamental picture of the company.
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On the company’s IPO price, analysts at brokerage firm Anand Rathi have said, “At the high (Rs 1,080) of the issue price band, the stock is valued at about 30x FY22 EPS of Rs 36. Pharma companies quote at an average P/E of 25x/22x FY24e/FY25e. We expect the company’s strong set of brands, focused approach to its chronic portfolio via recent acquisitions, launches and differentiated pipeline products to be key positives. However, risks are addition of NLEM lists, rise in raw material prices.”
