Can you tell me about the proposed IPO of Mankind Pharma?
Answer
Answer
One of India’s largest unlisted pharma companies in India, Mankind Pharma, is planning an IPO for which the filing will happen shortly. Incidentally, Mankind is one of India’s biggest unlisted pharmaceutical companies in India. It is backed by one of the most respected private equity companies in India viz. Chrysalis Capital. Some of the top brands of Mankind Pharma in India include Manforce Condoms, Kaloree 1 and Prega News.
Mankind has seen investments from a number of marquee PE players, apart from Chrysalis Capital. Mankind also the backing of Capital International as also the early investment backing of Government Investment Corporation of Singapore. In 2018, a consortium of Chrysalis Capital, GIC Singapore and Canadian Pension Fund had bought 10% stake in Mankind Pharma for $350 million, valuing Mankind Pharma at $3.50 billion enterprise value.
While the numbers are awaited, market estimates that the IPO could peg Mankind valuations at $8 billion to $10 billion. That would position Mankind Pharma in the league of the top notch pharma valuation plays in India. The IPO will be entirely an offer for sale as Mankind Pharma is cash rich and does not need fresh funds. The offer for sale (OFS) route will be designed to give exit to some of its marquee early investors.
The issue size is expected to be in the range of Rs.7,000 crore to Rs.7,500 crore and would entail the sale of 10% stake in the company by the early investors and promoters. That would peg the valuation of Mankind Pharma at closer to $10 billion. Currently, Mankind is at an advanced stage of appointing merchant bankers as BRLMs to manage the issue. Currently, it is trying to expand its OTC products basket in search for better margins.
Mankind Pharma is has a pedigree of over 27 years in this business and it is based out of Delhi. Its product portfolio includes, inter alia, prescription medicines, OTC products and veterinary medicine. Mankind Pharma also has a strong global presence that is currently spread across over 34 countries. Some of the main export markets for Mankind Pharma are the US, Sri Lanka, Cambodia, Kenya, Cameroon, Myanmar, and the Philippines.
The company has reported solid financials for the latest fiscal year ending March 2021. Mankind Pharma reported FY21 PAT of Rs.1,293 crore on sales of Rs.6,385 crore, assigning a healthy net profit margins or NPM of 20.25%. Mankind Pharma also reported operating EBITDA margins of 25.95%. It had recently acquired the formulations brands of Panacea Biotec in India and Nepal for a consideration of Rs.1,872 crore.