Supriya Lifescience IPO: Supriya Lifescience Limited opened its initial public offering, or IPO, a day back and was already oversubscribed 2.33 times on Day 1 as per data from the BSE. Supriya Lifescience is one of the key Indian manufacturers andsuppliers of active pharmaceuticals ingredients (“APIs”), with a focus on research and development. The strong response for the Supriya Lifescience IPO was backed by retail buyers who subscribed 11.84 times the shares set aside for them on the first day of bidding. The quota allocated for non-institutional investors was booked 66 per cent so far. However, qualified institutional buyers were yet to place bids for the offer as of Day 1 of the bidding process.
Here are the key details about Supriya Lifescience IPO that you should know if you want to bid for the offer:
Supriya Lifescience IPO Price, Other Details
The price band of the Supriya Lifescience IPO was fixed at Rs 265 to Rs 274 per equity share. The IPO will be open from subscription till December 20, and had opened on December 16. It will be closed for bidding on December 18 and 19 since markets are closed on weekends.
Supriya IPO plans to raise Rs 700 crore at the upper end of the price band, but has 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.
Supriya IPO Lot Size
Investors can bid for a minimum of 54 shares of the Supriya Lifescience IPO and in multiples of 54 thereof. A bidder can bid for a minimum of one lot and a maximum of 13 lots.
As much as 75 per cent of the total offer of the Supriya Lifescience IPO has been reserved for Qualified Institutional Buyers, while 15 per cent of the shares have been reserved for non institutional buyers. Retail investors can bid for up to 10 per cent of the total offer size.
Supriya Lifescience IPO GMP
The unlisted shares of Supriya Lifescience IPO was fetching a premium of Rs 280, which is more than 102 per cent of the upper price band of Rs 274. The high grey market premium of Supriya Lifescience IPO indicated a strong listing for the issue later this month.
Supriya Lifescience IPO Strength
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.
Should You Subscribe?
Anand Rathi: At the upper end of the IPO price band, Supriya Lifescience Ltd. is offered at P/E of 17.8x its FY21 earnings, with a market capitalization of
Rs 22,052 Million. The company has significant scale with leadership position across & niche products; It is backward integrated and has advanced
manufacturing, research and development capabilities. The company has high profit margins, strong balance sheet and reported RoNW of 46.04 per cent in FY21. However, the IPO is fully priced and demanding rich valuations – hence we give the IPO a “Subscribe (Long Term)” rating.
HEM Securities: Company with significant scale & leadership position across key
& niche products has backward integrated business model & advanced manufacturing and research and development capabilities. Also company has shown consistent financial performance due to de-risked business model & has experienced senior management team and qualified operational personnel.
Hence, looking after all above we recommend “Subscribe” on issue for both listing gain & long term purpose.
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