Akums Drugs IPO fully subscribed on first day, driven by retail and NII; check GMP

The public subscription period for the IPO, priced between Rs 646 and Rs 679 per share, runs from July 30 to August 1, Mint reported.

The company announced on Monday, a day before the IPO opened for public subscription, that it had secured Rs 829 crore from anchor investors.

The overall subscription status for Akums Drugs and Pharmaceuticals' IPO was 1.37 times.

The retail investor portion was subscribed 3.35 times, non-institutional investors' portion received 1.96 times subscription, and the portion for qualified institutional buyers (QIBs) was booked 43%, according to the report.

The employee portion saw a subscription of 1.07 times.

The IPO received bids for 2,08,08,172 shares against the 1,51,62,239 shares available, according to BSE data.

The company has allocated 75% of the issue size for QIBs, 15% for non-institutional investors, and 10% for retail investors. Investors can bid for a minimum of 22 equity shares and in multiples thereof.

Founded in 2004, Akums is a contract development and manufacturing organization (CDO) for pharmaceuticals, offering a wide range of products and services both in India and internationally, it said.

According to the red herring prospectus (RHP), the company's listed peers include Divi's Laboratories (P/E of 74.99), Suven Pharma (P/E of 69.54), Gland Pharma (P/E of 42.45), Torrent Pharma (P/E of 60.20), Alkem Laboratories (P/E of 34.18), Eris Lifesciences (P/E of 34.95), JB Chemicals (P/E of 51.38), Mankind Pharma (P/E of 44.65), and Innova Captab (P/E of 29.91).

The Akums Drugs and Pharmaceuticals IPO, valued at Rs 1,857 crore, includes a fresh issue of Rs 680 crore and an offer-for-sale (OFS) of 17,330,435 equity shares by the promoters and other investors.

In the OFS, Ruby QC Investment Holdings Pte Ltd will sell 1.43 crore shares, while promoters Sanjeev and Sandeep Jain will each sell 15.12 lakh equity shares.

The net proceeds from the fresh issuance will be used to repay debts of the company and its subsidiaries—Pure and Cure Healthcare, Maxcure Nutravedics, and Pure. The funds will also support inorganic growth projects and meet increased working capital requirements.

The book-running lead managers for the IPO are ICICI Securities Ltd, Axis Bank Ltd, Citigroup Global Markets India Private Ltd, and Ambit Private Ltd. Link Intime India Private Ltd is the registrar for the offering.

The grey market premium (GMP) for Akums Drugs and Pharmaceuticals IPO was +Rs 204 on Tuesday, according to investorgain.com. This means that Akums Drugs shares were trading at a premium of Rs 204 in the grey market.

Based on the upper end of the IPO price band and the current grey market premium, the estimated listing price of Akums Drugs shares was projected to be Rs 883 per share, which is 30.04% higher than the IPO price of Rs 679.

The grey market premium reflects investors' willingness to pay more than the issue price, indicating strong demand for the shares.