Glenmark Life Sciences Listing: Shares of Glenmark Life Sciences had a weak start in the market today. Its shares started trading at Rs 750 against the IPO price of Rs 720 per share, ie at a premium of about 4.32 percent. However, gradually its shares rose and its price rose by 7.02 percent to reach a price of Rs 770.55 on the BSE.
The IPO of Glenmark Life Sciences received an overwhelming response from investors. The company is a unit of the market listed Glenmark Pharma, which develops and manufactures high value, non-commoditized APIs and has around 120 products in its portfolio. Its market cap at the time of listing was Rs 9203 crore.
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IPO was subscribed 44.17 times
The IPO of Glenmark Life Sciences was open from July 27-19. This IPO was subscribed 44.17 times by the investors. The share reserved for retail investors was subscribed 14.63 times, the share reserved for non-institutional investors (NIIs) was 122.54 times and the share reserved for qualified institutional buyers (QIBs) was subscribed 36.97 times. Under this IPO of Rs 1541 crore, fresh shares worth Rs 1060 crore have been issued and the remaining shares have been issued through OFS (Offer for Sale). Under this IPO, the price band of Rs 2 face value shares was kept at Rs 695-720 and the lot size was 20 shares.
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Expert gave rating of subscribe
- Glenmark Life Sciences portfolio comprises 120 molecules, most of which are non-commodity. According to the note of Ashika Stock Broking, Commoditized molecules are simple, whereas Non-Commoditized molecules are large and complex and their cost is also high. As per Ashika Stock Broink’s note, the post issue PE valuation based on upper price band is 25.1x while the listed peers are trading at 30x-60x and the industry average is 40x. In such a situation, the IPO of Glenmark Life Sciences is at a discount compared to Pierce. Glenmark Life Sciences has a good track record. The company’s focus is on R&D, Expansion, Growth Opportunity in CDMO Services and Expansion of Complex API Portfolio. Due to this, Ashika Stock Broking has given subscribe rating to the issue.
- According to analyst Prabhudas Lilladher, if the PE valuation of the company is 22.1 times based on the upper price band, then it is a better price. The issue was also rated subscribed by brokerage firm Prabhudas Lilladher due to its manufacturing capability of leading APIs, better relationship with global clients, cost leadership, focus on R&D and experienced management team.