5 pharma IPOs to raise over Rs 8K cr in August

Mumbai: Riding on huge investor interest in the healthcare sector, five pharma companies are tapping the initial public offering (IPO) market over the next couple of weeks to raise over Rs 8,000 crore.

The list include the Rs 4,000-crore IPO by the Bain Capital-backed Emcure Pharma, the Rs 1,500-crore issue by Vijaya Diagnostic Centre, diagnostic firms Krsnaa Diagnostics (Rs 1,200 crore) and Mumbai-based bulk drugs maker Supriya Lifesciences (Rs 1,200 crore), and pharma formulations contract development and manufacturer (CDMO) Windlass Biotech's Rs 400 crore issue.

Investment bankers estimate these five companies to together raise over Rs 8,300 crore through the public offerings this month.

According to data available with the stock exchanges, so far this fiscal, 12 firms have raised Rs 27,000 crore from IPOs, and Rs 70,000-crore more issues are in the pipeline. The entire FY21 saw only 30 IPOs raising Rs 31,277 crore.

Apart from these pharma firms, Devyani International and and Exxaro Tiles are opening on August 4 and issues from consumer-focused companies like Paytm, Mobikwik, Policybazaar, Cartrade, Delhivery and Nykaa shortly. According to marketmen as many as 40 issues are lined up for the rest of the year looking to raise Rs 70,000 crore.

While 12 companies raised Rs 27,052 crore through IPOs in the first four months of the current fiscal, and PowerGrid InvIT has mopped up Rs 7,735 crore through its IPO.

As against this, the entire FY21 saw only 30 issues raising Rs 31,277 crore, Rs 20,352 crore by 13 companies in FY20, 14 firms raising Rs 14,719 crore in FY19 and 45 main-board IPOs collectively mobilising Rs 82,109 crore in FY18.

That there is tremendous investor appetite is clear from the way the issues from Tatva Chintan Pharma Rolex Rings, GR Infraprojects, Clean Science & Technology, Shyam Metalics & Energy, India Pesticides, Dodla Dairy, Glenmark Life Sciences and Zomato were subscribed-- 29 times to 180 times.

In fact, pharma stocks have been in the limelight since the pandemic broke out last year and the BSE healthcare index has been ruling at all-time highs for long.

Recent healthcare listings have also done well, as evinced by the Rs 2,144-crore KIMS Hospitals issue which since listing gained over 45 per cent. And the Rs 1,514-crore Glenmark Life Sciences issue, closed on July 29, received the highest number of retail applications since 2008.

Pharma companies are also gaining from the tailwinds to the API market, and the China plus one strategy where India is the key focus.