Gland Pharma IPO: All You Need To Know
A medical worker prepares to inject a patient with a syringe in this arranged photograph taken at the Chaika Clinic in Moscow, Russia. (Photographer: Andrey Rudakov/Bloomberg)

Gland Pharma IPO: All You Need To Know

Gland Pharma Ltd.’s three-day initial public offer opens on Nov. 9 as the China’s Sanghai Fosun-controlled injectables maker sells shares in what will be the biggest maiden offer by a pharmaceutical company in India.

The company plans to raise Rs 6,480 crore through the maiden offer at a price band of Rs 1,490-1,500 apiece. The issue comprises a fresh issue of equity shares worth Rs 1,250 crore, and offer for sale for 3.5 crore shares by promoters and other shareholders.

  • Issue opens: Nov. 9
  • Issue closes on: Nov. 11
  • Face value: Re 1 per share
  • Listing on: NSE, BSE
  • Minimum bid: 10 shares

Kotak Mahindra Capital Company Ltd., Citigroup Global Markets India Pvt., Haitong Securities India Pvt. and Nomura Financial Advisory and Securities (India) Pvt. are the lead managers to the issue.

The company has already allocated 1.30 crore equity shares at Rs 1,500 apiece to 70 anchor investors, raising Rs 1,944 crore ahead of the IPO.

Shareholding Pattern

Sanghai Fosun, through its subsidiary Fosun Pharma Industrial Pte., holds 74% stake in the company. It will fall to 58% after the offer.

Business

Established in Hyderabad in 1978, Gland Pharma is an injectable-focused drugmaker with a footprint across 60 countries, including markets such as the U.S., Europe, Canada, Australia and India. The company, which largely operates in the business-to-business segment, makes and markets complex injectables with drugmakers including Sagent Pharmaceuticals Inc and Apotex Inc.

The U.S. is Gland Pharma’s largest market contributing more than 60% to its sales.

It undertakes domestic marketing for variety of products across therapeutic segments, including anti-infectives, pain management, orthopedics, cardiology.

It’s also engaged in global out-licensing and partners with several pharma companies on expense and profit-sharing model to provide end-to-end solution—from API, method and formulation development to dossier compilation and submission

The company, with a presence in sterile injectables, oncology, and opthalmics, has seven manufacturing facilities in India. This includes four finished formulations facilities with a total of 22 production lines, and three API facilities.

Gland Pharma has 265 drug filings-- 189 filings for sterile injectables, 50 for oncology and 26 for ophthalmic-related products.

Its top five customers accounted for nearly half of its total revenue from operations in fiscals ended March 2018, 2019, 2020 and the June quarter.

Key Risks

  • Failure or delay in obtaining necessary permits or approvals.
  • Interruption in API production or failure to produce or procure high-quality APIs might impact sales causing delay.
  • Raw material supply disruptions due to strained India-China relations.
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