Windlas Biotech Limited IPO details – Date, Price, Size, Allotment Status, Subscription

IPO-Note	Windlas Biotech Limited
Rs-448-Rs460per Equity share	Recommendation: Listing Gain

 

Company Profile: –

Windlas Biotech is amongst the top five players in the domestic pharmaceutical formulations contract development andmanufacturing organization (“CDMO”) industry in India in terms of revenue. The company has three distinct strategic business verticals: (i) CDMO Services and Products; (ii) DomesticTrade Generics and over-the-counter (“OTC”) Brands; and (iii) Exports. Itprovidesa comprehensive range of CDMO services ranging from product discovery, product development, licensing and commercial manufacturing of generic products, including complex generics.Domestic Trade Generics and OTC Brands vertical include nutraceutical and health supplement products that do not require prescription and are marketed, distributed and promoted in India under its own brand names. Currently its own and operate four manufacturing facilities located at Dehradun in Uttarakhand.

 

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Issue Details
Objects of the issue	·          To purchase equipment required for capacity expansion of our existing facility at Dehradun Plant IV. ·          To finance incremental working capital requirements of the company. ·          Repayment/prepayment of company’s borrowings. ·          General corporate purposes.
Issue Size	Total issue Size -Rs. 401.54Cr. Offer for Sale – Rs. 236.54Cr. Fresh Issue – Rs. 165 Cr
Face value	Rs.5.00 Per Equity Share
Issue Price	Rs. 448 – Rs. 460
Bid Lot	30shares
Listing at	BSE, NSE
Issue Opens:	4thAug, 2021 – 6th Aug, 2021
QIB	50% of Net Issue Offer
Retail	35% of Net Issue Offer
NIB	15% of Net Issue Offer

Financial Performance:

 

 

Shareholding Pattern:

Shareholding Pattern	Pre- Issue	Post Issue
Promoters & Promoter Group	78.00%	65.16%
Public	22.00%	34.84%

 

Strengths:

• CDMO player with focus on the chronic therapeutic category
• Innovative portfolio of complex generic products supported by robust R&D
• Long-term relationships with Indian pharmaceutical companies
• Efficient and quality compliant manufacturing facilities with significant entry barriers

Key Highlights:

• Revenue from operations has grown at a CAGR of 18% during FY19-FY21.
• PAT margin (Profitbefore exceptional items divided by revenue from operations) increased from 4.93% in Fiscal 2020 to 8.70% in Fiscal 2021.
• There was an exceptional gain in FY19 from losing control in subsidiary company for Rs. 49.5 Crore which boost the profit for that period.
• Again, there was an exceptional loss of Rs. 27 Crore. due to Impairment of Goodwill in FY21 which negatively impacted the Profit for the period.
• In Fiscal 2021,CDMO Services and Products vertical accounted for 84.66% of total revenue from operations.
• Current Ratio of the company increased at 2.08 in FY21 vs 1.34 in FY20.

Risk Factors:

• Depends on the success of its relationships with its CDMO customers
• Subject to strict technical specifications, quality requirements, regular inspections and audits by their CDMO customers
• Requires significant amount of working capital as a considerable amount of time passes between purchase of raw materials and sale of products.

Outlook:

Windlas Biotech is providing a comprehensive range of CDMO services ranging from product discovery,product development, licensing and commercialmanufacturing of generic products, including complex generics. It has developed relationships with various leading Indian pharmaceutical companies, including Pfizer Ltd, Sanofi India Ltd, Cadila Healthcare Ltd, Emcure Pharmaceuticals Ltd, Eris Lifesciences Ltd, Intas Pharmaceuticals Ltd and Systopic Laboratories Pvt Ltd. The domestic formulations CDMO is projected to grow at a CAGR of approximately 14%as more pharmaceutical companies are outsourcing R&D activities to academic and private contract research organizations. In Fiscal 2020, its market share was approximately 1.5% in terms of revenue in the domestic formulationsCDMO industry. Due to the high working capital requirement the company has low CFO/EBITDA at 0.3 times in FY21 and 0.74 in FY20.At the higher end of the price band of Rs. 460, the stock is offered at a PE multiple of64.4x on FY21 Post issue EPS of Rs. 7.14We would recommend Listing Gain to this IPO considering financials of the company.

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