Glenmark Life IPO subscribed 2.8x on Day-1 on strong retail interest

The wholly-owned subsidiary of Glenmark Pharma is issuing Rs 1,060 cr fresh equity and offer for sale of 6.3 million shares worth Rs 453.6 crore

The initial public offer (IPO) of Glenmark Life Sciences was subscribed 2.8 times on Tuesday, the first day of the issue.

The wealthy investor portion was subscribed 88 per cent, and the retail portion was subscribed 5.3 times. On Monday, the company allotted shares worth Rs 454 crore to anchor investors.

The IPO closes on Thursday.

Glenmark Life Sciences, a developer and manufacturer of active pharmaceutical ingredients (APIs), has priced its IPO between Rs 695 and Rs 720 per equity share. At the upper end, the company will have a market cap of Rs 8,822 crore.

Glenmark Life, a wholly-owned subsidiary of Glenmark Pharma, plans to issue Rs 1,060 crore of fresh equity in the IPO. The IPO also comprises an offer for sale of 6.3 million shares worth Rs 453.6 crore by Glenmark Pharma. Following the IPO, Glenmark Pharma’s stake will come down from 100 per cent to 82.84 per cent.

The company proposes to utilise the net proceeds from the fresh issue towards payment of outstanding purchase consideration to the promoter for the spin-off of the API business from the promoter into the company. And funding the capital expenditure requirements.

Glenmark Pharmaceuticals launched its API manufacturing business in 2001-02 with a manufacturing facility in Kurkumbh. In 2019, the API manufacturing business of Glenmark was spun off into Glenmark Life Sciences as part of a broader reorganisation.

The company is a developer and manufacturer of select APIs in chronic therapeutic areas, including cardiovascular disease, central nervous system disease, pain management and diabetes. It also manufactures and sells APIs for gastro-intestinal disorders, anti-infectives and other therapeutic areas. The company also provides contract development and manufacturing operations services to multinational and specialty pharmaceutical companies.

As of March 31, 2021, the company sold its APIs in India, Europe, North America, Latin America, and Japan.

The company operates four multi-purpose manufacturing facilities situated at Ankleshwar and Dahej in Gujarat, India, and Mohol and Kurkumbh in Maharashtra.

Kotak Mahindra Capital, BofA Securities and Goldman Sachs are the global co-ordinators and book running lead managers to the offer. DAM Capital Advisors, BOB Capital Markets and SBI Capital Markets are the book running lead managers to the offer.