OFS: Glenmark Pharmaceuticals Plans to Divest Its Entire Stake in Glenmark Life Sciences

Strategic Move by Glenmark Pharmaceuticals

Glenmark Pharmaceuticals Ltd. has announced its plan to divest its entire 7.84% stake in Glenmark Life Sciences Ltd. (GLS) through an offer for sale (OFS) in the secondary market. The board approved the sale of up to 96.09 lakh shares at a meeting on Wednesday. Additionally, Chairman and Managing Director Glenn Mario Saldanha will offload 7,800 shares in the offer, according to an exchange filing.

Key Dates and Investor Details

The OFS will open for bidding on July 11 for institutional investors and on July 12 for retail investors. Non-retail investors will be able to carry forward their unallotted bids to July 12, allowing them to potentially receive shares from any unsubscribed portion of the retail category. The floor price for the Glenmark Life Sciences OFS has been set at Rs 810 per share, reflecting an 8% discount from Wednesday’s closing price.

About Glenmark Life Sciences

Glenmark Life Sciences is engaged in the development, manufacturing, and sale of active pharmaceutical ingredients (APIs) and intermediates. The company also provides contract development and manufacturing organization (CDMO) services for APIs. Earlier this year, unlisted consumer goods and cement maker Nirma Ltd. completed the acquisition of a 75% stake in the company.

Market Performance and Financial Highlights

Ahead of the announcement, shares of Glenmark Life Sciences settled 1.48% lower at Rs 875.85 apiece, while Glenmark Pharmaceuticals stock ended 1.53% higher at Rs 1,379.85 apiece, marking a fresh high. This movement contrasts with a 0.53% decline in the benchmark BSE Sensex.

In 2024, GLS shares gained approximately 33.30%. The company’s revenue from its top 10 generic API products accounted for 49% of its total revenue in FY24, compared to 45% in FY23 and 49% in FY22. Despite lacking long-term contracts, GLS maintains relationships of over five years with most of its clients. As of March 2024, GLS had filed over 520 drug master filings/certificates of suitability/dossiers across various markets, including the US, Europe, Brazil, Canada, Japan, Russia, and others. Notably, GLS had filed 164 drug master filings in the US alone by the end of Q4 FY24.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.