PharmEasy Parent All Set to File DRHP Soon for Rs. 6,000 – 7,000 Crores IPO

API Holdings, the parent company of PharmEasy, is ready to file a draft red herring prospectus in the coming 7-10 days for an IPO worth Rs. 6,000 – 7,000 crores. This IPO will be a potential full primary share sale.

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PharmEasy To Join a Pool of Top-Tier Start-ups

With this IPO, India’s largest e-pharmacy will join a pool of top-tier start-ups that are ready to go public in 2021. As PolicyBazaar, Nykaa, and Paytm are up with their IPOs around Diwali, PharmEasy is likely to enter the primary market before the end of this financial year.

In addition, the leading logistics firm, Delhivery, is also in the last stages of filing its DRHP in the coming week.

PharmEasy is planning to raise as much as Rs. 6,000 – 7,000 crores via its IPO. According to reports, the DRHP is said to be a minimum of Rs. 6,000 crores and the company could further increase it by 20%, according to SEBI’s rules.

This ‘start-up of the year award’ nominee planned to file DRHP by October, which was delayed due to the pre-IPO round. That is why the company will file its IPO papers in November now.

2021 has been a record year for start-ups. This sector has witnessed unprecedented capital inflow and is on the verge of growth. As for PharmEasy, there are some commendable milestones achieved which are mentioned below:

• The company has raised around $1 billion so far in 2021
• It joined the unicorn club in April
• After filing the DRHP, it will join other big names, including Nykaa, Delhivery, PolicyBazaar, etc.
• Earlier in 2021, PharmEasy acquired Thyrocare, which is a publicly listed company and a chain of preventive and diagnostic care laboratories.
• Aims to transform into an e-healthcare platform while competing with Netmeds and Tata’s 1mg.
• It has also launched a 4-hour express delivery service in big cities like Gurugram, Bengaluru, Kolkata, and Mumbai.

Pre-IPO Round

This leading e-pharmacy recently closed an almost $350 million pre-IPO round. Reports suggest that PharmEasy will list at a higher valuation as compared to this pre-IPO round. However, this is not yet final. The company will look into more room for valuation growth after the listing. Accordingly, it will price its IPO.

Sources mention that there is sufficient bullishness to price the IPO at over $8 billion. However, it will decide that close to the listing date post-filing the DRHP.

Acquisition Splurge

PharmEasy is also planning to grab a significant stake in the enterprise resource planning country Marg ERP. Marg was founded in 1992 and deals in business software products. The company specialises in FMCG trade and pharmaceuticals with solutions concerning accounting, digital payments, and customised inventory for small and medium firms.

According to sources, this will be roughly Rs. 400 crores deal, and the discussions regarding the same are in advanced stages.

Moreover, PharmEasy had also finished a $180-190 million acquisition of Aknamed, a cloud-based supply chain management start-up firm. Before this, the company made its biggest-ever acquisition. It acquired the leading diagnostic chain, Thyrocare, for more than $600 million in June 2021.

Bottom Line

With specific growth initiatives and continuous development plans, PharmEasy is all set to broaden its brand positioning. The company’s long-term goal is to place itself as a digital healthcare player rather than being a mere e-pharmacy platform.

 

Frequently Asked Questions

1. How much is the venture capital investment in Indian start-up firms?

As of 7 October 2021, venture capital investment in start-up firms was $26 billion.

2. What was PharmEasy’s valuation after its pre-IPO round?

Soon after its pre-IPO round, PharmEasy’s valuation was around $5.6 billion.

3. How much is PharmEasy planning to acquire in Marg ERP?

PharmEasy is in talks to acquire around 49% stake in this enterprise.