According to Topline Securities, the issue’s advisor and book-runner, the book-building process for Citi Pharma’s Initial Public Offering (IPO) ended with a two-fold oversubscription.
In a statement, the country’s top API maker stated, “The IPO got an enormous reaction from institutional investors and high-net-worth individuals as the strike price clocked in at Rs. 32 per share, 14.3 percent higher than the floor price of Rs. 28.”
Citi Pharma has raised a total of Rs. 2.32 billion, making it the second Pharma sector IPO in 23 years and the highest IPO of 2021 so far.
Topline Securities’ Mohammed Sohail said, “The response to the book building was significantly better than our expectations.” Investors in Topline’s most recent IPO (Organic Meat) saw a gain of nearly 90% in less than a year.
Investor demand totaled Rs. 4 billion, compared to the IPO’s book-building size of Rs. 2 billion, as a result of several brokerages issuing nearly unanimous calls to “subscribe.” Investors who bid at Rs. 32 will receive roughly 10% of their bid amount.
The remaining 18.1 million shares (or 25% of the overall offer size) would be sold to the general public on June 23-24 at a strike price of Rs. 32, according to the firm.
In his message, Citi Pharma CEO Rizwan Ahmed thanked investors for their extraordinary response and pledged to protect shareholders’ equity.
“Citi Pharma is one of the most unique enterprises in Pakistan’s pharma sector, and this growth will usher in a new phase for the company,” said Omar Salah Ahmed, Head of Corporate Finance & Advisory at Topline. We wish them the best of luck in the future, as well as the investors who will undoubtedly be a part of an exciting development storey. Investors have reacted positively to the prospect of future growth.”
Citi Pharma aims to be Pakistan’s first fully integrated publicly traded pharmaceutical company, servicing everyone from raw material suppliers to end-users.
Citi Pharma’s revenue increased by 36.2 percent over five years, from Rs. 1,016 million in FY16 to Rs. 3,528 million in FY20. The company’s sales in 9MFY21 were Rs. 4,015 million, up from Rs. 4,015 million the previous year.
The company plans to raise its paracetamol production capacity from 3,600 to 6,000 tonnes per year. Furthermore, the company claims it intends to grow its current product line by adding new APIs and pharmaceutical formulations, or finished pharmaceuticals.
Citi Pharma also plans to establish three manufacturing facilities, bringing its total capacity to 200,000 vials/injectables per day, 60,000 bottles per day for dry powder/suspension, 4.2 million capsules per day, and 4.5 million tablets per day. Penicillin, cephalosporin, and psychiatric and narcotic medications all have distinct manufacturing lines.
Source: propakistani.pk
