Supriya Lifescience
Listing performance
Scheduled dates
Tentative timetable — a past date is not confirmation the step completed
Issue details
- IPO date
- 16 Dec 2021 – 20 Dec 2021
- Listing date
- 28 Dec 2021
- Face value
- ₹2 per share
- Issue price
- ₹274 per share
- Lot size
- 54 shares
- Total issue size
- ₹700 Cr
- Market cap at offer price
- ₹700 Cr
- Promoter holding
- 99.98% → 68.24% pre-issue → post-issue
- ISIN
- INE07RO01027
- Registrar
- MUFG Intime India Pvt.Ltd.
- Lead managers
- Axis Capital Ltd.
- Registered office
- 207/208, Udyog Bhavan, Sonawala Road, Goregaon (East), Maharashtra
Reservation and application size
How the issue is split between investor categories, and what each may bid
| Investor category | Shares | % of net | % of total |
|---|---|---|---|
| Anchor investor · within QIB | 1,14,96,351 | — | — |
| Market maker | 0 | — | — |
Application size
Minimum 54 shares per lot, in multiples, at ₹274
| Application | Lots | Shares | Amount |
|---|---|---|---|
| Retail (min) | 1 | 54 | ₹14,796 |
| Retail (max) | 13 | 702 | ₹1,92,348 |
| S-HNI (min) | 14 | 756 | ₹2,07,144 |
| S-HNI (max) | 67 | 3,618 | ₹9,91,332 |
| B-HNI (min) | 68 | 3,672 | ₹10,06,128 |
Category limits
| Category | Bid size | Cut-off |
|---|---|---|
| Retail (RII) | Up to ₹2 lakh | Yes |
| Small HNI (sNII) | ₹2 lakh – ₹10 lakh | No |
| Big HNI (bNII) | Above ₹10 lakh | No |
| Employee | Up to ₹5 lakh | Yes |
Bidding at cut-off means accepting the final issue price without naming one. Only retail and employee applicants may do so.
Anchor investors
Institutional allocation placed a day before the issue opens, carved out of the QIB portion and locked in after listing.
Valuation and performance
Valuation at offer price
| Metric | Pre-issue | Post-issue |
|---|---|---|
| Market cap | — | ₹700 Cr |
About Supriya Lifescience
Supriya Lifescience Limited was incorporated on March 26, 2008 pursuant to the conversion of the partnership firm 'M/s Supriya Chemicals' into a public limited company, and commenced operations on April 1, 2008; its registered and corporate office is at Goregaon (East), Mumbai. Per the prospectus, it is one of the key Indian manufacturers and suppliers of active pharmaceutical ingredients (APIs) with a focus on R&D, offering 38 niche APIs as of October 31, 2021 across antihistamine, analgesic, anaesthetic, vitamin, anti-asthmatic and anti-allergic therapeutic segments, and has consistently been the largest exporter of Chlorpheniramine Maleate and Ketamine Hydrochloride from India (contributing 45-50% and 60-65% of India's respective API exports between Fiscal 2017 and 2021) and among the largest exporters of Salbutamol Sulphate (31% of India's exports in FY2021 by volume). Its business is organised into domestic and export sales: from April 1, 2020 until October 31, 2021 its products were exported to 86 countries to 1,296 customers including 346 distributors, and export sales contributed 77.47% of revenue from operations in Fiscal 2021. Operations are supported by a modern manufacturing facility at Parshuram Lote, Maharashtra (spread across 23,806 sq.mt with 547 KL/day reactor capacity, four manufacturing blocks and seven cleanrooms) and a DSIR-approved R&D facility with 23 scientists; 12 of its products were backward integrated as of October 31, 2021. The company earns revenue by manufacturing and selling APIs directly to pharmaceutical manufacturers and pharmaceutical distributors in India and overseas; Fiscal 2021 revenue from operations was ₹ 3,853.66 million with restated profit of ₹ 1,238.28 million (Fiscal 2019: ₹ 2,778.40 million and ₹ 394.24 million).
Company Analysis
from RHPSupriya Lifescience Limited is one of the key Indian manufacturers and suppliers of active pharmaceutical ingredients (APIs), with a focus on research and development, serving both domestic and export pharmaceutical markets.
Supriya Lifescience Limited was incorporated on March 26, 2008 pursuant to the conversion of the partnership firm 'M/s Supriya Chemicals' into a public limited company, and commenced operations on April 1, 2008; its registered and corporate office is at Goregaon (East), Mumbai. Per the prospectus, it is one of the key Indian manufacturers and suppliers of active pharmaceutical ingredients (APIs) with a focus on R&D, offering 38 niche APIs as of October 31, 2021 across antihistamine, analgesic, anaesthetic, vitamin, anti-asthmatic and anti-allergic therapeutic segments, and has consistently been the largest exporter of Chlorpheniramine Maleate and Ketamine Hydrochloride from India (contributing 45-50% and 60-65% of India's respective API exports between Fiscal 2017 and 2021) and among the largest exporters of Salbutamol Sulphate (31% of India's exports in FY2021 by volume). Its business is organised into domestic and export sales: from April 1, 2020 until October 31, 2021 its products were exported to 86 countries to 1,296 customers including 346 distributors, and export sales contributed 77.47% of revenue from operations in Fiscal 2021. Operations are supported by a modern manufacturing facility at Parshuram Lote, Maharashtra (spread across 23,806 sq.mt with 547 KL/day reactor capacity, four manufacturing blocks and seven cleanrooms) and a DSIR-approved R&D facility with 23 scientists; 12 of its products were backward integrated as of October 31, 2021. The company earns revenue by manufacturing and selling APIs directly to pharmaceutical manufacturers and pharmaceutical distributors in India and overseas; Fiscal 2021 revenue from operations was ₹ 3,853.66 million with restated profit of ₹ 1,238.28 million (Fiscal 2019: ₹ 2,778.40 million and ₹ 394.24 million).
Objects of the Issue
- Funding capital expenditure requirements of our Company (expansion of existing manufacturing facilities at Main plant at Lote, Ratnagiri district, Maharashtra — site development, civil and electrical works, reactors, centrifuges, dryers, storage tanks, solvent recovery line, electrical panel and fitting equipment, utilities equipment and effluent treatment plant upgrade) ₹ 923.00 million p.75
- Repayment and/or pre-payment, in full or part, of certain borrowings availed by our Company (working capital facilities — packing credit, post shipment credit in foreign currency and cash credit — from Saraswat Cooperative Bank) ₹ 600.00 million p.84
- General corporate purposes ₹ 359.52 million p.85
Issue Structure
- Total Issue
- 25,547,445* Equity Shares for cash at price of ₹ 274 per Equity Share (including a premium of ₹ 272 per Equity Share), aggregating to ₹ 7,000 million (*subject to finalisation of Basis of Allotment)
- Fresh Issue
- 7,299,270* Equity Shares aggregating to ₹ 2,000 million
- Offer for Sale
- 18,248,175* Equity Shares aggregating to ₹ 5,000 million by Satish Waman Wagh (Promoter Selling Shareholder)
- Price Band
- ₹ 265 (Floor Price) to ₹ 274 (Cap Price) per Equity Share; Offer Price finalised at ₹ 274
- Lot Size
- 54 Equity Shares and in multiples of 54 Equity Shares thereafter
- Face Value
- ₹ 2 each
Business Model
Manufactures active pharmaceutical ingredients (APIs) at its Parshuram Lote, Maharashtra facility and earns revenue from their sale to pharmaceutical companies and pharmaceutical distributors, organised into domestic sales and export sales across 86 countries; many products are backward integrated into intermediates/key starting materials, and sales are made on the basis of purchase orders rather than long-term contracts.
Business Segments
SWOT Analysis
- • Leadership position in key niche APIs – largest Indian exporter of Chlorpheniramine Maleate and Ketamine Hydrochloride(p.131)
- • Backward integration across 12 products driving margins and supply security(p.133)
- • Geographically diversified revenue base with exports to 86 countries including regulated markets(p.133)
- • Modern, scale manufacturing facility with large reactor capacity(p.134)
- • Consistent strong financial performance with high growth and positive operating cash flows(p.135)
- • Positive operating cash flows every year since incorporation(p.135)
- • Experienced promoter and senior management team(p.135)
- • R&D-driven organisation with DSIR-approved facility and dedicated scientist team(p.135)
- • High product concentration – top three APIs contribute ~50% of revenue(p.26)
- • Customer concentration with no long-term contracts – top 10 customers at 47.13% of revenue in H1 FY22(p.27)
- • No long-term customer contracts; reliance on ad-hoc purchase orders(p.27)
- • Single-location manufacturing and R&D concentration in Maharashtra (Parshuram Lote)(p.32)
- • Sub-optimal capacity utilisation, falling to 49% in Apr-Oct 2021(p.32)
- • Dependence on limited suppliers for scarce key raw materials(p.33)
- • Outstanding borrowings of ₹809.44 million with restrictive lender covenants limiting flexibility(p.34)
- • Near-total promoter control (99.98% pre-Offer) persisting post-listing, risking minority shareholder conflicts(p.39)
- • Capacity expansion of existing facilities funded through IPO net proceeds(p.135)
- • Entry into new therapeutic areas beyond current portfolio(p.136)
- • Deepening presence and share gains across existing international geographies(p.137)
- • China+1 sourcing shift positioning India as preferred API supplier(p.110)
- • Government impetus via PLI scheme and bulk drug parks aiding long-term growth(p.108)
- • Global pharmaceutical market expanding to USD 1,585-1,625 billion by CY25(p.98)
- • Indian bulk drug exports projected to grow at 8-9% CAGR FY20-FY25(p.107)
- • Intense competition from larger players with greater resources(p.35)
- • Extensive multi-jurisdictional regulation; precedent of temporary Chinese import ban on Chlorpheniramine Maleate following NMPA audit(p.30)
- • Foreign exchange rate fluctuations impacting export-denominated revenues(p.36)
- • COVID-19 / future pandemic disruption to operations, supply chains and demand(p.28)
- • Raw material supply disruptions and price volatility (incl. ~31-32% sourced from China)(p.33)
- • Technological change rendering current technologies obsolete and requiring heavy capital investment(p.35)
- • Deterioration in Indian/global macroeconomic conditions(p.46)
Promoters
| Name | Role | Pre-Issue | Post-Issue |
|---|---|---|---|
| Satish Waman Wagh | Promoter / Promoter Selling Shareholder | 99.26% | 67.58% |
| Smita Satish Wagh | Promoter Group | 0.44% | 0.40% |
| Asha Waman Wagh | Promoter Group | 0.20% | 0.18% |
| Saloni Satish Wagh | Promoter Group | 0.04% | 0.04% |
| Shivani Satish Wagh | Promoter Group | 0.04% | 0.04% |
| Supriya Pharmaceuticals (partnership firm represented by Satish Waman Wagh & Smita Satish Wagh) | Promoter Group | 0.00% | 0.00% |
Leadership
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