Biocon launches Rs 4,500-crore QIP; to issue 11.6% of equity base

Biocon opens Rs 4,500-crore qualified institutional placement to repay debt, invest in Biocon Biologics and meet general corporate obligations

Bengaluru-based biopharmaceutical firm Biocon on Monday launched a qualified institutions placement (QIP) to raise Rs 4,500 crore. As part of the offering, the firm will issue up to 139 million new shares — 11.6 per cent of its current outstanding equity base. The floor price for the QIP has been set at Rs 323.2.

 

Shares of Biocon last closed at Rs 357.3, valuing the firm at Rs 42,900 crore. The issuance price will be finalised on Thursday, while trading in the new shares will commence from Tuesday.

 

This comes after the company’s board had approved the raising of funds by way of QIPs for an aggregate amount of up to Rs 4,500 crore on 23 April. The move received shareholder approval on 4 June through postal ballot.

 

Biocon will use the QIP proceeds to purchase outstanding optionally convertible debentures issued by subsidiary Biocon Biologics. It will also use the proceeds to repay outstanding debt and for general corporate purposes.

 

In an earnings call for Q4FY25, Kedar Upadhye, Chief Financial Officer (CFO) of Biocon Biologics, stated that the company had a net debt of US$1.2 billion, excluding structured instruments. 

 

In the same call, Biocon Chief Executive Officer (CEO) and Managing Director Siddharth Mittal added that the first tranche was expected to be completed by mid-June.

 

“The proceeds of the fund will primarily be used to meet financial obligations towards the commitments and the put options from the structured debt that we had from the investments in Biocon Biologics,” he said.

 

In an interview last month, Biocon Executive Chairperson Kiran Mazumdar-Shaw had also stated that their goal was to complete the fundraising within three to four months.

 

BofA Securities, Kotak Mahindra and Goldman Sachs are the investment bankers handling the share sale, according to the company’s regulatory filing.

 

The company’s announcement came after market hours. On Monday, Biocon’s shares went up marginally by 0.52 per cent, closing the day’s trade at Rs 357.30.