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SUPRIYA LIFESCIENCE IPO

  • Writer: Yash Mehta
    Yash Mehta
  • Dec 15, 2021
  • 2 min read


IPO Details:

Price Band: 265-274

Cutoff Price: 274


About Company:


Supriya Lifesciences is one of the key Indian manufacturers and suppliers of active pharmaceutical ingredients (“APIs”), with a focus on research and development.

Company have niche product offerings of 38 APIs focused on diverse therapeutic segments such as antihistamine, analgesic, anaesthetic, vitamin, anti-asthmatic and anti-allergic. Company has consistently been the largest exporter of Chlorpheniramine Maleate and Ketamine Hydrochloride from India, contributing to 45-50% and 60-65%, respectively, of the API exports from India, between Fiscal 2017 and 2021. Company was among the largest exporters of Salbutamol Sulphate in India contributing to 31% of the API exports from India in FY 2021 in volume terms.


Competitive Strengths:

  1. Significant scale with leadership position across key & niche products.

  2. Backward integrated business model.

  3. Geographically diversified revenues with a global presence across 86 countries.

  4. Advanced manufacturing and research and development capabilities.

  5. Consistent strong financial performance due to de-risked business model.

  6. Experienced senior management team and qualified operational personnel.


Strategies:

  1. Expansion of manufacturing capabilities.

  2. Expanding product portfolio with increasing R&D capabilities.

  3. Increase current market presence and enter new markets and.

  4. Continue to focus on operational excellence.

Financial Performance:



Revenue of the company is increasing. Company is profitable and cutoff price is at P/E of 16.


Objects of the Issue:


The Net Proceeds from the Issue are proposed to be utilised in the following manner:

  1. Offer for Sale

  2. Funding Capex

  3. Repaying Loan


Competitors Comparison:

Considering listed companies that are in adhesives business, Supriya Lifescience seems to be undervalued on the basis of the P/E ratio, whereas it looks slightly overvalued on the basis of P/B ratio.


Grey Market Premium:


Our view: GMP of the IPO is good and overall the company looks slightly undervalued. I will subscribe to this IPO only for listing gains.


Disclaimer: Views are shared for an educational purpose. Please consult your financial advisor or planner before taking any action based on the views or facts shared on this blog.

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