You are here: Home » Markets » IPOS » News
Business Standard

Gland Pharma makes strong market debut on Friday, stock rises 21%

The post-listing market capitalisation for the company stands at Rs 29,848 crore, helping it break into the top 10 valuable pharma firms in the country

Topics
Gland Pharma | initial public offerings IPOs

Sundar Sethuraman  |  Thiruvananthapuram 

IPO
The Rs 6,480-crore IPO was one of the biggest by a pharma company in the domestic market

made a strong debut on the bourses on Friday. The stock got listed at Rs 1,701 — a 13.4 per cent premium to its issue price — and ended the session at Rs 1,820, up 21 per cent over its issue price. The post-listing market capitalisation for the company stands at Rs 29,848 crore, helping it break into the top 10 valuable pharma firms in the country.

The Rs 6,480-crore IPO was one of the biggest by a pharma company in the domestic market. The price band was set at Rs 1,490-1,500 per share. The IPO comprised a fresh issue of Rs 1,250 crore and an offer for sale of Rs 5,230 crore. The firm plans to use the proceeds to fund working capital requirements.

The Fosun-promoted firm’s IPO had managed to sail through on the back of institutional investor support, even as retail and high networth individual (HNI) investors shunned the issue. The institutional investor portion of the IPO was subscribed 6.4x, while the HNI portion was subscribed just 0.5x and retail investor portion 0.23x. Overall subscription stood at 2.06x.

Analysts had recommended Gland Pharma, citing its attractive valuation, healthy growth rate, and margins.

chart

Yet, the IPO struggled to get through due to concerns — especially among HNI investors — over the grey market premium (GMP). Ahead of its listing, the GMP had soared. Analysts had cited this sudden turnaround in GMP for stressing the fact that investors should consider the fundamentals and pricing of the issue, instead of demand in the grey market, while investing in an IPO.

Dear Reader,


Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Fri, November 20 2020. 23:49 IST
RECOMMENDED FOR YOU
.