Macleods Pharma Files DRHP for Rs. 5,000 Cr IPO!

On Tuesday, 15 February 2022, Macleods Pharmaceuticals reported that it had filed a DRHP (draft red herring prospectus) with SEBI for its IPO (initial public offering) of Rs. 5,000 crores.

Let’s dwell on the details!

Know About Macleods Pharma’s OFS!

The IPO comprises an OFS (Offer for Sale) of 60.48 million shares (maximum) through the promoter and promoter group. The company’s promoters who will engage in the sale of shares are Dr. Rajendra Agarwal, Banwarilal Bawri and Girdharilal Bawri.

The promoter and promoter group wholly owns this entity ─ established during the year 1989. Since its inception, it has emerged organically with internal accruals. This means it has avoided raising external funds through private equity firms.

Get an Insight into Macleods Pharma!

As per AIOCD, Macleods is the 7^th largest pharmaceutical company of India for the 6 months ended on 30 September 2021. The firm is more prominent in East and North India. It is famous for its hormone treatment, dermatology, anti-diabetic, cardiovascular and anti-infective brands.

The entity has its presence in emerging and developing markets such as the Commonwealth of Independent States, South America, Asia, Africa, Europe and North America.

How Is Its Business Going?

In FY 21, Macleods Pharma has a net profit worth Rs. 2,023 crores and revenue worth Rs. 7,750 crores. The domestic business consists of branded generics, accounting for 51.73% of the company’s revenue from operations. As per IQVIA, its domestic sales surged at a CAGR of nearly 15.30%, relative to a 10.80% rise in the IPM’s domestic sales from FY 11 – FY 21.

Revenue from the firm’s operations outside the country hiked at a CAGR (compound annual growth rate) of 21.51 per cent across FY 19 – FY 21, establishing a 48.27 per cent of total revenue from operations during FY 21.

Parting Words

Macleods Pharma markets, manufactures and develops a variety of therapeutic formulations within and outside India. The promoters of the company will bring forth a secondary share sale through the initial public offering. Since the public issue is an offer for sale, its entire proceeds will belong to the selling shareholders, and the entity will not obtain any proceeds through it.

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Frequently Asked Questions

1. Which investment banks will be advising Macleods on its IPO?

Investments banks, namely Nomura, ICICI Securities Ltd., Edelweiss Financial Services Ltd., Citigroup and Kotak Mahindra Capital, are the advisers for Macleods Pharma’s IPO.

2. What are Macleods Pharma’s EBITDA margins from FY 20 to FY 21?

Macleods Pharma’s EBITDA margin rises to 29.12% in FY 21 from 24.98% in FY 20. EBITDA denotes earnings before interest, taxes, depreciation and amortisation.

3. What are Macleods Pharma’s profit after tax margins from FY 20 to FY 21?

Profit after tax margin for Macleods Pharma increased to 22.65% in FY 21 from 21.17% in FY 20.

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