The Akums Drugs and Pharmaceuticals Ltd IPO has attracted significant attention in the market. By July 31, 2024, it had been subscribed 1.37 times overall. This strong interest is particularly evident in the retail segment, where the subscription reached 3.35 times. The IPO opened for subscription on July 30 and will close on August 1, 2024.
The total IPO size is ₹1,857 crore. It includes a fresh issue of ₹680 crore and an offer-for-sale (OFS) of 17,330,435 equity shares by the promoters and other investors. This division ensures a broad distribution of shares, attracting different types of investors.
The price band for the IPO is set between ₹646 and ₹679 per share. Investors have shown considerable interest, with bids amounting to 2,08,08,172 shares against the 1,51,62,239 shares available. This high demand underscores the market’s confidence in Akums Drugs.
Retail investors have played a significant role, subscribing to 3.35 times their allotted portion. Non-Institutional Investors (NIIs) subscribed to 1.96 times their portion. Qualified Institutional Buyers (QIBs) showed a 43% subscription rate. The employee portion of the IPO was also well-received, with a subscription rate of 1.07 times.
Subscription Breakdown:
- Retail Investors: 3.35 times subscription
- Non-Institutional Investors: 1.96 times subscription
- Qualified Institutional Buyers: 43% subscription
- Employee Portion: 1.07 times subscription
Established in 2004, Akums Drugs is a contract development and manufacturing organization (CDMO). The company offers a wide range of pharmaceutical products and services both in India and internationally. This broad portfolio has attracted significant investor interest.
The net proceeds from the fresh issue will be used to repay debt, fund working capital requirements, pursue inorganic growth initiatives, and for general corporate purposes. This strategic use of funds is expected to strengthen the company’s financial position and support its expansion plans.
Akums Drugs IPO Overview
| Details | Information |
|---|---|
| Qualified Institutional Buyers Subscription | 43% |
| Employee Subscription | 1.07 times |
| IPO Size | ₹1,857 crore |
| Fresh Issue | ₹680 crore |
| Offer-for-Sale (OFS) | 17,330,435 equity shares |
| Price Band | ₹646 to ₹679 per share |
Market Confidence and Future Prospects
The IPO has also attracted anchor investors, raising ₹829 crore a day before the public issue opened. This initial investment reflects strong institutional confidence in Akums Drugs’ prospects.
The grey market premium (GMP) for Akums Drugs IPO is currently +204. This indicates that shares are trading at a premium of ₹204 in the grey market, suggesting a potential listing price of ₹883 per share. This premium highlights investor optimism about the company’s future performance.
Akums Drugs’ listed peers include Divi’s Laboratories, Suven Pharma, Gland Pharma, Torrent Pharma, Alkem Laboratories, Eris Lifesciences, JB Chemicals, Mankind Pharma, and Innova Captab. These companies have varying P/E ratios, reflecting different market valuations and offering a benchmark for Akums Drugs.
The book running lead managers for the Akums Drugs IPO are ICICI Securities Ltd, Axis Bank Ltd, Citigroup Global Markets India Private Ltd, and Ambit Private Ltd. The registrar for the offering is Link Intime India Private Ltd. These organizations are pivotal in ensuring the smooth execution of the IPO.
Akums Drugs’ IPO is a combination of a fresh issue of equity shares worth ₹680 crore and an OFS of 1.73 crore shares valued at ₹1,177 crore at the upper end of the price band. This dual approach helps balance the company’s funding needs and provides liquidity to existing shareholders.
The IPO allocation is structured with 75% set aside for QIBs, 15% for NIIs, and 10% for retail investors. Investors can bid for a minimum of 22 equity shares and in multiples thereafter. This structure aims to ensure broad participation across different investor segments.
Overall, the Akums Drugs IPO reflects strong market interest and confidence in the company’s future. The funds raised will support the company’s growth initiatives, strengthen its balance sheet, and enhance its competitive position in the pharmaceutical industry.
Get a detailed overview of Akums Drugs IPO. here.
People May Ask
What is the subscription status of the Akums Drugs IPO?
The IPO has been subscribed 1.37 times overall, with the retail portion subscribed 3.35 times.
When is the IPO open for subscription?
The subscription period is from July 30 to August 1, 2024.
What is the price band for the Akums Drugs IPO?
The price band is set between ₹646 to ₹679 per share.
How will the proceeds from the IPO be used?
The proceeds will be used to repay debt, fund working capital, pursue inorganic growth initiatives, and for general corporate purposes.
Who are the key clients of Akums Drugs?
Some key clients include Alembic Pharmaceuticals, Alkem Laboratories, Cipla, Dabur India, Dr. Reddy’s Laboratories, and more.
What is the Grey Market Premium (GMP) for the Akums Drugs IPO?
The GMP is currently +204, indicating a potential listing price of ₹883 per share.
