Akums Drugs to Launch IPO on July 30

25 Jul 2024 , 12:23 PM

Delhi-based Akums Drugs and Pharmaceuticals, a leading contract development and manufacturing organization (CDMO), is set to launch its initial public offering (IPO) on July 30. The company has set a price band of ₹646-679 per share for the IPO, which includes a fresh issuance of shares worth ₹680 Crore and an offer-for-sale (OFS) of 1.73 Crore equity shares by existing shareholders.

Promoters Sanjeev Jain and Sandeep Jain will each sell 15.12 lakh equity shares in the OFS, while investor Ruby QC Investment Holdings Pte Ltd will offload 1.43 Crore shares. Ruby QC Investment’s weighted average cost of acquisition was ₹231.64 per share. Currently, the promoters hold an 82.44% stake in Akums, with Ruby QC Investment owning 14.65%, and the remaining 2.91% held by employee trusts.

The IPO includes a reservation of up to ₹15 Crore worth of shares for the company’s employees. The net issue, excluding the employees’ portion, will be distributed with 75% allocated to qualified institutional buyers (QIBs), 15% to non-institutional investors, and 10% to retail investors. The IPO will close on August 1, with the anchor book for QIBs opening on July 29.

Proceeds from the fresh issue will be utilized to repay the debts of Akums and its subsidiaries, Maxcure Nutravedics and Pure and Cure Healthcare. Additionally, funds will be allocated for incremental working capital requirements and inorganic growth initiatives.

Akums, which claims to be the largest India-focused CDMO by revenue, production capacity, and clients served in FY23, held a 30.2% market share of the Indian domestic CDMO market by value in FY24. The Indian domestic CDMO market is expected to grow at a CAGR of 14.3% from FY24 to FY28, reaching a market size of $2.8 billion.

Akums operates 10 manufacturing units with a cumulative formulation manufacturing capacity of 49.23 billion units annually as of FY24. The company is also set to launch a new injectable facility in FY25.

ICICI Securities, Axis Capital, Citigroup Global Markets India, and Ambit are the book-running lead managers for the IPO, while Link Intime India is the registrar.