08 May “Mankind Pharma GMP Today : Will it be a Boom or Bust?”
“Mankind Pharma IPO: A Closer Look at the Risks and Rewards – Should you buy after listing?”
Are you ready for the big debut of one of the most talked-about pharmaceutical companies in India?
Mankind Pharma, a major player in the industry, is all set to make its grand entry on the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) tomorrow, May 9, 2023.
The Indian pharmaceutical industry has been on a steady rise in recent years, with increasing demand for affordable healthcare solutions.
The IPO has generated a lot of buzz in the market. However, while market observers predict a positive listing, experts caution that the listing gain may not be very high.
In this blog post, we will take a closer look at the Mankind Pharma IPO and what it means for investors and the Indian pharmaceutical industry.
Grey Market Suggests Positive Listing
Ahead of the listing, market observers and lucky allottees are busy calculating the expected listing premium from the IPO.
-According to market observers, the grey market premium (GMP) for Mankind Pharma IPO has surged to ₹103 per equity share, indicating a positive listing.
– which is ₹3 higher than its previous day’s GMP of ₹100.
-Despite the weakness on Dalal Street on Friday due to HDFC twins rebalancing by MSCI, Mankind Pharma IPO GMP has surged today.
What is GMP?
-GMP stands for Grey Market Premium.
-It refers to the premium at which shares of an IPO are traded in the unofficial or grey market before they are listed on the stock exchanges.
-The grey market operates outside the purview of the stock exchanges and is an informal platform where investors trade shares without any regulatory oversight.
-The GMP is an indicator of the market demand for the shares of the IPO, and it gives an idea of the potential listing price of the shares.
-However, it’s important to note that the GMP is completely speculative and unregulated and may not necessarily reflect the actual listing price of the shares.
What Does GMP Mean?
-Market observers believe that the GMP of ₹103 suggests that Mankind Pharma IPO’s listing price would be around ₹1183, which is approximately 9.50% higher than the IPO price band of ₹1026 to ₹1080 per equity share.
-However, experts caution that GMP is completely speculative and not an ideal indicator of expected listing premiums.
-Investors should focus on fundamental analysis, including balance sheets and financial details, for a more concrete picture of the company.
The Must-Check Fundamentals Before Investing
Objects of the Issue:
-The company will not receive any proceeds from the offer and all the offer proceeds will be received by the selling shareholders, in proportion to the offered shares sold by the respective selling shareholders as part of the offer.
-This statement indicates that the IPO is solely an offer for sale (OFS) by the existing shareholders of the company.
-It also implies that the company is not raising any fresh capital through this IPO.
-All the proceeds from the sale of shares in the IPO will go to the selling shareholders, in proportion to the shares sold by each of them.
-Since the company is not raising any fresh capital through the IPO, investors may want to carefully consider the financial health and growth prospects of the company before making an investment decision.
-It may also indicate that the company’s management and existing shareholders are looking to cash out some of their stake in the company.
-All the proceeds from the IPO will go to the existing shareholders who are selling their stake, which could potentially affect the company’s future growth trajectory.
The Promoters are
Ramesh Juneja Family Trust,
Rajeev Juneja Family Trust, and
Prem Sheetal Family Trust.
Pre-Issue Share Holding – 79.00%
Post Issue Share Holding – 76.50%
-Mankind Pharma is a leading pharmaceutical company based in India, with a presence in over 22 countries worldwide.
-Founded in 1995 by R.C. Juneja,
-The company has grown to become one of India’s top 5 pharmaceutical companies, with a focus on providing high-quality and affordable medicines to people across the globe.
Business Model of Mankind Pharma:
Mankind Pharma has a diverse product portfolio that includes
-OTC drugs, and
-personal care products.
The company’s major therapeutic areas include
It is also a major player in the reproductive health segment, with its popular brands like Manforce and Prega News.
Manufacturing and R&D
-Mankind Pharma has 9 state-of-the-art manufacturing facilities and
-4 R&D centers in India.
-The company’s manufacturing facilities are compliant with international regulatory standards, including the US FDA and UK MHRA.
-The R&D centers are focused on developing new and innovative products to meet the evolving needs of patients and healthcare providers.
-Mankind Pharma has a pricing strategy that focuses on providing high-quality and affordable medicines to people across the globe.
-The company has been able to achieve this by leveraging its strong manufacturing capabilities, optimizing its supply chain, and adopting cost-efficient production processes.
Mankind Pharma has a robust distribution network that covers over 22 countries worldwide. The company has a strong presence in India, with a network of over 60,000 retail outlets and 600 distributors. It has also established a significant presence in emerging markets like Africa, South East Asia, and the Middle East.
Key Performance Indicator
P/E (x) – 32
Market Cap- Rs 43263 cr
ROE – 27%
ROCE – 26%
EPS -Rs 33
Risk in investing
-The pharmaceutical industry is highly regulated, and any changes in regulations, licensing requirements, or compliance standards can impact the company’s operations and financial performance.
-For instance, if the government imposes price controls on essential drugs, it could impact Mankind Pharma’s revenues and profitability.
-Mankind Pharma faces intense competition from both domestic and international players in the pharmaceutical market.
-The entry of new players, new product launches, or pricing pressures from competitors could impact the company’s market share and financial performance.
Supply chain risks:
-Mankind Pharma relies on a complex supply chain network
-to source raw materials,
-manufacture drugs, and
-distribute them to customers.
Any disruption or delay in the supply chain, whether due to natural disasters, transportation issues, or labor strikes, could impact the company’s operations and financial performance.
Intellectual property risks:
Mankind Pharma’s success is largely dependent on its ability to develop and protect its intellectual property rights.
Any legal challenges to its patents or trademarks, or the expiration of its patents, could impact the company’s revenues and profitability.
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