Supriya Lifescience Limited Archives

SEBI Bans Futures Trading In Seven Commodities

The Securities and Exchange Board of India (SEBI) has banned futures trading on seven commodities. The commodities are paddy (non-basmati), wheat, chana, mustard seeds and their derivatives, soya bean, crude palm oil, and moong. The move comes in the wake of the opposition that the incumbent government is facing in the wake of the country’s rising inflation rates. The food inflation in India has gone up from 0.85% in the previous month to 1.87%.

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Shriram Properties Shares List at 24% Discount, Manage To Recover

Real estate developer Shriram Properties got listed today at 20% lower than its issue price of Rs 94. Shriram Properties’ issue price was Rs 118. The share price recovered, touching Rs 102-Rs 103 and closing at Rs 98. Shriram Properties posted a loss of Rs 60.03 crore in the six months ended September 2021. In FY21, the company’s loss narrowed to Rs 68.17 crore from Rs 86.39 crore a year ago. The company’s revenue decreased to Rs 431.5 crore from Rs 571.96 crore during the same period.

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Axis Bank to Raise Rs 5,000 Crore Using Bonds

Axis Bank will raise up to Rs 3,500 crore by issuing bonds. The board of directors had recently voted to allow the bank to borrow up to Rs 35,000 crores using debt instruments, perpetual debt instruments, AT-1 bonds, infrastructure bonds, Tier II capital bonds, etc. “We now wish to inform you that the Bank proposes to raise funds by issuing Senior Unsecured Taxable Redeemable Non- Convertible Debentures (Series – 6) of Rs.10 lakh each for cash at par with a base issue size of Rs 2,000 crore and Greenshoe option to retain oversubscription of Rs. 3,000 Crore thereby aggregating up to Rs. 5,000 crore”, said Axis Bank in a regulatory filing.

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Supriya Lifescience IPO Oversubscribed 71x On Final Day

On its final day, Supriya Lifescience IPO has oversubscribed nearly 71 times. The public issue subscribed 55.76 times in the retail category, 31.83 times in the Qualified Institutional Buyers (QIB) category, and 161.22 times in the Non-Institutional Investor (NII) category. The Basis of Allotment would be decided on Dec 23, 2021. The shares will tentatively list on Dec 28, 2021.

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Royal Enfield Recalls 26,300 Units Of Classic 350 Due To Potential Brake Issue

Eicher Motors-owned Royal Enfield has recalled nearly 26,300 units of its 2021 variant of Classic 350 motorcycles citing a potential issue with the brakes. The company said in an official statement that a higher braking load applied on the rear brake pedal can potentially damage the reaction bracket. Local dealerships and service stations may call consumers whose Vehicle Identification Number (VIN) falls within September 1 to December 5, 2021. Consumers can check out the website or reach out to the nearest workshop.

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Vedanta Acquires Nicoment, Becomes Only Nickel Producer In India

Vedanta Ltd has acquired Goa-based Nicoment, a leading nickel, and cobalt producer, making it the sole Nickel producer in India. Currently, India imports 100% of its nickel requirement from abroad. Nicolet has a capacity to produce 7.5 tonnes per annum of nickel and cobalt. With an ambitious plan in the place, Vedanta plans to meet 50% of India’s Nickel requirements.

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Equitas Small Finance Bank Becomes banking partner for Maharashtra Govt.

Equitas Small Finance Bank announced on Monday that it is now empanelled as the banking partner for the Government of Maharashtra. The move will enable Equitas to open salary accounts for all existing employees and pension accounts for pensioners for the Government of Maharashtra. The other three banks assigned with the role of disbursing salaries are Bandhan Bank, Karur Vysya Bank, and The South Indian Bank.

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ITI Limited receives ₹433 cr worth order from Tamil Nadu Govt.

Indian Telephone Industries Limited (ITI) has received an order from TANFINET (Tamil Nadu Fibrenet Corporation Limited) (A Govt. of Tamil Nadu Undertaking) regarding BharatNet Phase-II. The contract would amount to Rs 433 crore. Under the project, ITI will be covering 10 districts, 109 blocks, 3103 Gram Panchayats, 845 Revenue villages across Tamil Nadu, providing a minimum of 1 Gbps bandwidth service.

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Wipro to acquire cybersecurity firm Edgile for $230 million

Wipro Limited has decided to acquire Texas-based headquartered Edgile for a consideration of $230 million. Edgile is a cybersecurity consulting provider that focuses on risk and compliance, information and cloud security, and digital identity. Together, Wipro and Edgile will develop Wipro CyberTransform, an integrated suite that will help enterprises enhance boardroom governance of cybersecurity risk, invest in robust cyber strategies, and reap the value of practical security in action.

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Supriya Lifescience Limited is a company that manufactures Active Pharmaceutical Ingredients (APIs). APIs are raw materials used in making drugs, medicines, vaccines, and other pharmaceutical products. Supriya Lifescience has filed for an Initial Public Offering (IPO) that goes live on December 16, 2021, and closes on December 20, 2021. The company plans to raise close to Rs 700 crore through the IPO. In this piece, we discuss the company’s business model, its finances, and what makes this IPO stand out from others.

Business Model

Headquartered in Mumbai, Supriya Lifescience Ltd produces 38 APIs focused on diverse therapeutic segments such as antihistamine, analgesic, anaesthetic, vitamin, anti-asthmatic and antiallergic. It is the largest exporter of Chlorpheniramine Maleate (CPM) and Ketamine Hydrochloride from India. CPM is used to treat hay fever, allergy and the common cold, whereas Ketamine Hydrochloride is used to make anaesthetic to induce a loss of consciousness and relieve pain.

According to a CRISIL report, the company was the largest exporter of Salbutamol Sulphate in India, contributing to 31% of the API exports from India in FY 2021 in terms of volume. Salbutamol Sulphate is used to treat asthma, bronchospasm, and reversible airways obstruction.

Ketamine Hydrochloride contributed the most to the revenue stream. In FY21, it contributed to 27.42% of total revenue, followed by Chlorpheniramine Maleate and Salbutamol Sulphate, which contributed 18.17% and 9.86%, respectively.

The company has a manufacturing plant in Lote in Ratnagiri District of Maharashtra. The main manufacturing plant at Lote is spread across 23,806 sq. mts, having a reactor capacity of 547 KL/ day and seven cleanrooms. The company has also acquired a plot of land of 12,551 sq. mt, near the present manufacturing facility for expanding capacity. The manufacturing plant has been approved by international drug agencies like USFDA, EDQM, TGA Australia, KFDA-Korea, PMDA-Japan, NMPA (previously known as SFDA)- China, Health Canada.

The company is export-oriented, with only 22.53% of total revenue coming from India for FY21. Its products were exported to 86 countries to 1,296 customers including 346 distributors. In all, Asia (excluding India) contributed to 29.3% of the total revenue, followed by Latin America at 19.2%, Europe at 17.4%, and North America at 4.8%.

At present, the company is entirely owned by the Wagh Family. Chairman Satish Wagh, his mother Asha Waman Wagh, wife Smita Satish Wagh, daughters Shivani and Saloni Wagh are the sole promoters in the company.

Financial Performance

The company has witnessed consistent growth in Total Revenue, Profit After Tax, and Total Asset holdings.

The company’s total income, EBITDA, and profit after tax grew at a CAGR of 17.73 %, 56.47%, and 77.23%, respectively, from Fiscal 2019 to Fiscal 2021.

As of September 30, 2021, the company had total borrowings of Rs 70.9 crore, down from a debt of Rs 89.8 crore in FY19.

IPO Details in a Nutshell

The company plans to raise a total of Rs 700 crore through the IPO. It would get Rs 200 crore in hand, and the remaining Rs 500 crore would go to the promoter Satish Waman Wagh. According to the company’s ‘Objects of the Offer’, it plans to use the money for the following purposes:

Rs 92.3 crore to be used for funding capital expenditure requirements of the company.
Rs 60 crore would be used for repayment or prepayment of borrowings or debt.

The Way Ahead

Supriya Lifescience will be one of the many pharmaceutical companies that get listed this year. The company’s diversified product portfolio and global market reach make it a relatively safer bet than others. It has even managed to diversify geographically, ensuring that geopolitical instability in a particular region does not impact the company’s performance. The company has shown strong growth in terms of Revenue, Net Profit, and Asset Holdings.

Through this IPO, the company plans to pay off ~85% of its total borrowings and still have a great amount for capital expenditure. Supriya Lifesceinces’s IPO shares are trading at a Grey Market Premium (GMP) of 91%. This means that the shares are trading at 91% more than their upper issue price band of Rs 247. It is advised that investors do thorough research before investing in all IPOs. You can check the official Red Herring Prospectus over here.