Supriya Lifescience IPO: The stock of pharmaceutical company Supriya Lifescience Limited made a bumper listing at the Dalal Street on Tuesday. Supriya Lifescience shares got listed at 55 per cent premium and was trading at Rs 425 per share during its opening on the Bombay Stock Exchange or BSE. This was up by Rs 151 over its issue price at the upper end of the price band. On the National Stock Exchange or NSE, the shares got listed at Rs 421 per share as per data. The public issue was subscribed nearly 72 times when it opened earlier this month and received stellar response from investors.
The issue received a stellar response largely on the backing of non institutional investors who booked 161.22 times the shares reserved for them. The retail category was subscribed 56 times and the Qualified Instituional Buyers portion was bid for 31.83 times of the shares reserved. According to data on the National Stock Exchange, Supriya Lifescience IPO the issue received bids for 1,03,89,57,138 shares against 1,45,28,299 shares on offer in total.
Supriya Lifescience is one of the key Indian manufacturers and suppliers of active pharmaceuticals ingredients (“APIs”), with a focus on research and development. The price band of the Supriya Lifescience IPO was fixed at Rs 265 to Rs 274 per equity share.
Supriya IPO had plans to raise Rs 700 crore at the upper end of the price band, but had already raised Rs 315 crore through anchor investors who booked the issue on December 15, a day prior of opening the issue. Supriya Lifescience IPO comprises of a fresh issue worth Rs 200 crore, while Rs 500 crore will be an offer for sale (OFS) for selling shareholders.
The company will not receive any proceeds from the OFS part of the issue. From the fresh issue net proceeds, Rs. 92.30 crore will be used to fund the proposed expansion of the manufacturing facility; Rs. 60 crore will be utilised for the repayment or pre-payment of certain borrowings availed by the company.
The company’s core strength lies in identifying generic molecules (off-patent) in its existing therapeutic segments which fits in to its existing chemistry and production infrastructure and its ability to develop the product and scale-up production, according to Anand Rathi. Supriya Lifescience’s backward integration of API ensures steady supply of intermediates. The company has four manufacturing blocks which are segregated therapeutic segment wise. Supriya Lifescience has delivered strong and consistent financial growth since Fiscal 2019. It has a proven track record of operations of over 12 years and has a strong balance sheet as well as a stable cash flow profile.
Ahead of its offering, brokerage houses were positive about the Supriya Lifescience IPO and most of them had given a subscribe rating to the issue, given its healthy financials as well as market predictions.
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