Gland Pharma Targets Fresh Investment of Rs 6000 Cr from IPO

Hyderabad based pharmaceutical company, Gland Pharma targets to raise capital funds worth Rs 6000 – Rs 7000 crores in IPO share launch. In its red herring prospectus filing with SEBI, the company has mentioned that IPO launch will include fresh scrips as well as offer for sale from promoters.

Gland Pharma has Chinese parents. Fosun Singapore and Shanghai Fosun Pharma are two of the promoters of Gland, and it will be first for any Chinese company to enlist with Indian bourses.

About Gland Pharma

Gland Pharma is a Hyderabad based pharmaceutical company that started in 1978 by P.V.N Raju. The company is mostly involved in developing, producing and marketing complex injectables, operates in the B2B model. They have an extensive business network spread over sixty countries, including the USA, India, Europe, Canada, and Australia.

In 2017, Singapore based Chinese pharmaceutical company, Fosun Pharma acquired a 74 percent share in Gland Pharma. Currently, Fosun Pharma is the main stakeholder, and the remaining percentage rests with  Gland Celsus (12.97 percent), Empower Trust (5.08 percent) and Nilay Trust (2.42 percent).

During FY20, Gland Pharma registered seventy-one percent growth rate with a profit of 772.85 crores. And, revenue increase pegged at Rs 2,633.24, up from last year by 28.8 percent.

Nature Of The IPO Offer

The red herring prospectus of Glad Pharma reads that IPO shares will contain both new stocks and offer for sale shares. Offer for sale shares are existing stocks with the promoters that they sell to the public to reduce their holding percentage in the company. The concept, introduced by SEBI in 2012 allows promoters holding more than 10 percent of share capital in a company to come up with such an offer. It is a facility offered to the  200 top companies by the regulator.

Gland Pharma offer for sale will consist of 3,48,63,635 scrips from the promoters. In a filing with Hong Kong Stock Exchange, Fosun Pharma mentioned that it is aiming at raising equity capital worth around $800 million and receiving in-principle approval for listing with BSE and NSE.

Conclusion

Amid COVID-19 condition, the equity market is undergoing a dry spell. The last big company that announced IPO launch was SBI Cards & Payments in March right before the countrywide lockdown was imposed. After almost four months gap, it seems like some actions are returning to the market. Gland Pharma will be one of the first fews to launch IPO schemes after the pause. The company will list its IPOs with both BSE and NSE.

Gland Pharma has appointed Kotak Mahindra Capital Company, Citigroup Global Markets India, Haitong Securities India and Nomura Financial Advisory and Securities (India) as their book running lead manager for the IPO scheme.