Emcure Pharma Plans To Raise Rs 300 Crore Through IPO

Pune-based Emcure Pharmaceutical (EPL) is planning to tap the capital markets to get listed on the bourses. The company intends to raise Rs 300 crore through a fresh issue of shares. The offering also comprises an Offer For Sale (OFS) of 25.13 equity shares by the existing shareholders. The company is yet to come out with the price band for the issue and the number of fresh issue shares. The public issue will be based on book-building method and the lead managers for it are DSP Merrill Lynch, IDFC Capital and Morgan Stanley India Company.

The pharmaceutical company, established in the year 1983, is involved in formulation, manufacturing and marketing of pharma products. Its product line includes Nucron, Xennea, Neuroscience, Oncocare, and various APIs. In addition, it is also active in medicines for HIV/AIDS. It has a fully integrated manufacturing facility. With its span in the Indian market, EPL's products are marketed to over 65 countries in Asia, Africa, Europe, Latin America, CIS and Middle East. These operations are managed by EPL's subsidiaries in Dubai, Brazil, South Africa, Singapore and Nigeria along with its branch offices in Russia and Morocco.

EPL, in terms of market share, was ranked 14th in India by IMS Health India. The company has entered into agreements for its marketing and distributed with companies including Roche, Sanofi, Novartis (India) etc.

On the financial front, EPL posted good numbers in FY12 as against those of FY11. Its topline grew to Rs 1804.5 crore, up by 34% in FY12. The other income declined in this period by 38% to Rs 2.7 crore. The 9MFY13 revenue for the company stood at Rs 1518.23 crore. Further, due to huge increase in consumption of raw material and other expenses, the total operating expenses increased by 34% to Rs 1501.77 crore in FY12, which was Rs 1118.51 crore in FY11. Increased sales have boosted the EBITDA to Rs 305.37 crore, showing growth of 30%. Interestingly, the company showed a jump of 16% in its bottomline to Rs 95.72 crore in FY12.

Further, EPL has plans to use the issue proceeds to meet the working capital requirement and carry-out research and development activities. The planned expenditure for capital requirement is Rs 119.71 crore and Rs 115 crore for R&D activities. As part of its expansion plan at the Hinjewadi plant, EPL intends to set up a new oncology solid dosage unit at P-II facility, steroid infectables unit at P-II facility and its existing injectables unit at P-I.

Moreover, as the company has yet not disclosed the issue price band and bid lot size, it is too early to take a call on subscribing to the issue. Keep watching this space for more issue related details.