Akums Drugs and Pharmaceuticals – About the Company
Founded in 2004, operates as a contract development and manufacturing organization (CDMO) specializing in pharmaceuticals. During FY23, the organization ranked first among CDMOs in terms of revenue, production capacity, and clientele served. Its primary objective is to provide end-to-end product development and manufacturing solutions to clients, including formulation research and development, regulatory dossier preparation, and testing services.
The company's value-based market share of the Indian domestic CDMO market increased from 26.7% in FY22 to 29.4% in FY23. Through its subsidiaries Akumentis and Unosource, the company actively markets its own branded formulations in India and internationally, in addition to its primary CDMO business.
Akums Drugs and Pharmaceuticals IPO Objectives
The issue consists of offer for sale and fresh issue.
Offer for Sale: - Company will receive no funds from proceeds from the Offer for Sale and all the funds from OFS will go to their respective promoter.
Fresh issue :-
| Objects | Estimated Amount |
| Repayment/prepayment of all or certain borrowings of our Company | Rs.1599 |
| Repayment/prepayment of all or certain borrowings of our Subsidiaries
namely, Maxcure Nutravedics Limited and Pure and Cure Healthcare Pvt Ltd |
Rs.2270.9 |
| Funding incremental working capital requirements of our Company | Rs.550 |
| Pursuing inorganic growth initiatives through acquisition | [●] |
| General corporate purposes | [●] |
| Net Proceeds | [●] |
Akums Drugs and Pharmaceuticals IPO Details:
| IPO Open Date | July 30, 2024 |
| IPO Close Date | August 1, 2024 |
| Basis of Allotment | August 2, 2024 |
| Listing Date | August 6, 2024 |
| Face Value | ₹1 per share |
| Price | ₹646 to ₹679 per share |
| Lot Size | 22 Shares |
| Total Issue Size | 27,345,162 shares |
| (aggregating up to ₹1,856.74 Cr) | |
| Fresh Issue | 10,014,727 shares |
| (aggregating up to ₹680.00 Cr) | |
| Offer For Sale | 17,330,435 shares |
| (aggregating up to ₹1,176.74 Cr) | |
| Issue Type | Book Built Issue IPO |
| Listing At | BSE & NSE |
| QIB Shares Offered | Not more than 75% of the Net Issue |
| Retail Shares Offered | Not more than 10% of the Net Issue |
| NII (HNI) Shares Offered | Not less than 15% of the Net Issue |
Issue Price & Issue Size
Issue price for Akums Drugs and Pharmaceuticals has been decided between range of ₹646 to ₹679 per share. Total issue size of Akums IPO is ₹1,856.74 Cr. Out of ₹1,856.74 Cr, Rs. 680 cores consist of fresh issue and Rs. 1176.74 crores is offer for sale.
Launch Date and Date of Allotment
Launch date for AKums IPO has been declared for July 30, 2024. The IPO will close on August 1, 2024. The basis of allotment will be announced next day of IPO closing i.e. August 2, 2024.
Financial Statements:
| Particulars | Six months ended Sep 30, 2023 | Financial Year 2023 | Financial Year 2022 | Financial Year 2021 |
| Revenue from operations | 21511.38 | 36548.2 | 36718.93 | 27726.29 |
| EBITDA | 414.31 | 3840.55 | -690.89 | 2584.99 |
| EBITDA margin | 1.91% | 10.38% | -1.87% | 9.42% |
| EBIT | -187.07 | 2712.46 | -1637.68 | 1886.58 |
| EBIT margin | -0.86% | 7.33% | -4.43% | 6.88% |
| Profit for the period / year | -1547.39 | 978.17 | -2508.74 | 1234.35 |
| Fixed asset turnover ratio | 1.89 | 3.41 | 3.79 | 3.26 |
| Debt-equity ratio | 1.26 | 0.75 | 0.58 | 0.11 |
| Return on equity | -27.23 | 13.52 | -40.13 | 13.91 |
| Return on capital employed | -1.83% | 24.60% | 18.89% | 21.06% |
| Segment results before depreciation | ||||
| CDMO | 2950.39 | 3922.89 | 4001.51 | 2765.15 |
| Branded and generic formulations | 157.04 | 451.05 | 339.99 | 319.24 |
| API | -210.48 | -1034.45 | -223.74 | -21.14 |
| Segment results before depreciation margin | ||||
| CDMO | 17.56% | 14.41% | 15.04% | 13.93% |
| Branded and generic formulations | 4.16% | 5.98% | 3.77% | 5.40% |
| API | -22.55% | -58.36% | -20.47% | -314.58% |
| Adjusted EBITDA | 2950.77 | 3400.86 | 4250.85 | 3123.22 |
| Adjusted EBITDA margin | 13.62% | 9.19% | 11.51 | 11.38% |
| Adjusted EBIT | 2349.39 | 2272.77 | 3304.06 | 2424.81 |
| Adjusted EBIT margin | 10.85% | 6.14% | 8.94% | 8.84% |
| Adjusted Return on equity | 5.41% | 3.11% | 14.51% | 12.27% |
| Adjusted Return on Capital employed | 10.30% | 10.77% | 17.22% | 16.69% |
| Particulars | For the 6-months
ended Sep 30, 2023 |
For the Financial Year | ||||||
| 2023 | 2022 | 2021 | ||||||
| (₹ in mil) | % of Rev. from Ops | (₹ in mil) | % of Rev. from Ops | (₹ in mil) | % of Rev. from Ops | (₹ in mil) | % of Rev. from Ops | |
| CDMO | 16805.98 | 78.13 | 27230.08 | 74.5 | 26610.96 | 72.47 | 21377.88 | 78.52 |
| Branded and generic formulations | 3771.98 | 17.53 | 7545.63 | 20.65 | 9014.76 | 24.55 | 5841.69 | 21.46 |
| API | 933.42 | 4.34 | 1772.49 | 4.85 | 1093.21 | 2.98 | 6.72 | 0.02 |
| Total | 21511.38 | 100 | 36548.2 | 100 | 36748.93 | 100 | 27226.29 | 100 |
Akums Drugs and Pharmaceuticals IPO Promoters & Shareholding of the Company
There are 3 promoters of the company;
- Sanjeev Jain
- Sandeep Jain
- Akums Master Trust.
As of the date of filing DRHP, promoters, in aggregate, hold 121,465,630 Equity Shares, representing 84.90% of paid-up Equity Share capital of company.
Why Invest in Akums Drugs and Pharmaceuticals IPO?
While investing in an IPO-bounded company, one should check their fundamentals that help an investor to visions companies financial performance and competitive strength which at last drives its business growth. Fundamental analysis apart from financial and competitive strength, also help you to know the risk factors that can affect the business operations and future prospects of the company. After evaluating the variables such strength weakness, financials, you may strike a balance and decide to invest or not invest in an IPO.
Competitive Strengths:
Largest CDMO serving the Indian pharma industry
Since 2004, company overtime with 10 manufacturing units has produced a cumulative formulations manufacturing capacity of 49.21 billion units annually, producing a wide range of dosage forms. The company has manufactured 4,025 commercialized formulations across over 60 dosage forms and held a 29.4% market share in the Indian domestic CDMO market.
Despite facing significant barriers to entry, such as high capital expenditure, R&D expertise, technical know-how, trained manpower, and long-drawn regulatory processes, the company has invested prudently in capital expenditure and investments in manufacturing operations and equipment. The company's network of manufacturing units allows it to produce diverse dosage forms and accommodate client requirements.
Diverse client base
As of Sep 30, 2023, their CDMO business had a client base of 1,345 Indian and multinational pharmaceutical. The 1000+ clients include pharmaceuticals, nutraceutical, cosmoderma, wellness, e-commerce, healthcare providers, and government entities.
In the FY23, they manufactured formulations for 26 of the top 30 pharmaceutical companies in India, and they have received repeat orders from 36 of our 50 largest clients in the past five years.
| Particulars | 6- Mon ended Sep 30, 2023 | FY23 | FY22 | FY21 |
| Revenue contrib. from our ten largest
clients by revenue in CDMO |
43.35 | 38.92 | 41.27 | 36.16 |
Strategic presence across value chain
The company serves as a CDMO, marketer of formulations, and manufacturer of APIs across the pharmaceutical value chain. As of Sep 30, 2023, the company has 190 dossiers under development and has begun API manufacturing operations through strategic acquisitions.
Risk Factors:
Concentrated R&D facilities and manufacturing facilities
As of Sep 30, 2023, the company runs 12 production units and 4 R&D facilities in Haridwar, Uttarakhand. Any disaster on hilly area/ mountain region or change in local or state government regulations may have a negative impact on the organization's finances, operations, and business.
Audits and inspections of facilities
Government agencies, clients both domestic and international, and international bodies have strict eye on quality requirements and rules that pharmaceutical makers must follow. Consequently, customers and regulatory agencies often conducts sudden audit and inspect industrial sites. Any failure to meet their contractual commitments or negative remark in finding of survey may have regulatory ramifications, regardless of any irregularities or noncompliance with terms or requirements.
Certain material contingent liabilities
| Particulars | As of September 30, 2023 (₹ in mil) |
| Income tax matters | 768.8 |
| Product pricing related matters | 106.4 |
| Others | 3.15 |
| Total | 878.35 |
Akums Drugs and Pharmaceuticals IPO Grey Market Premium (GMP)
GMP is the premium price paid over the IPO issue price. This premium is seen from speculator or trader view, that they are ready to pay in the grey market. GMP is an unofficial ecosystem that is determined in the grey market and keeps fluctuating as per the demand and supply of the shares in the primary market. However, GMP only should be not considered as a reliable factor to determine the listing price of an IPO-bounded company, as there are various factors that affect the stock market and individual stocks.
Also Read: What are the Top Factors Affecting the Stock Market in India
The IPO date has been announced for Akums Drugs and Pharmaceuticals IPO. According to web sources, the Grey market premium (GMP) of IPO has been trading at premium of Rs. 150 in grey market.
Also Read: What is Grey Market Premium in IPO: How is GMP Calculated & Reliable
How to Apply for Akums Drugs and Pharmaceuticals IPO?
If you choose the best discount brokers in India like Moneysukh, you can easily apply in the Akums Drugs and Pharmaceuticals IPO or invest in any listed companies in the secondary market. You just need to open a trading account and demat account to apply in the IPOs, or do trading and investing in the stock market through the best trading platform at Moneysukh.
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Also Read: Things to Know Before Starting Forex Trading & How to Start
Steps to Apply for Akums Drugs and Pharmaceuticals IPO:
Step 1: Wait for the date Akums Drugs and Pharmaceuticals IPO to open for online bidding.
Step 2: Now browse the trade.moneysukh.com and log in with your User ID & password.
Step 3: Here you need to find the IPO section and click onAkums Drugs and Pharmaceuticals IPO.
Step 4: Now just fill in the required details like price, quantity, and so on.
Note: While applying in any IPO, make sure to bid at the cutoff price before submitting your application.
Step 5:Finally make the payment and then submit your IPO application successfully.
How to Check Akums Drugs and Pharmaceuticals IPO Allotment Status?
Apart from Moneysukh, you can also use stock exchange websites like BSE or NSE to check the Akums Drugs and Pharmaceuticals IPO allotment status. Checking the allotment status is possible only after the closing of the bidding and the basis of the allotment date arrives. You can use your PAN card details and IPO application number to check the Mobikwik IPO allotment status.
Also Read: How to check IPO allotment status on NSE, BSE through Moneysukh
However, if the IPO is oversubscribed in all the categories including retail and HNI, then there is less chance of getting the allotment of shares. But if you follow the investing tips while applying for in IPO, you can improve your chances of allotment in the IPO.
Also Read: How to Increase the Chances of IPO Allotment
If you have not been allotted any share, your IPO application money will be refunded into your bank account or the fund will be unblocked if applied through ASBA. If you have allocated any share in the allotment, then it will be transferred into your demat account before the listing that you can sell to book profits or keep from the long-term investment viewpoint.
Also Read: What to Know Before Investing in Stocks: 10 Things to Consider
