Innova Captab IPO - Investment Rationale, Issue Details, Financials, Strengths, Risks: Anand Rathi

Anand Rathi's IPO Report

Innova Captab Ltd. will launch its initial public offering today and will and conclude on December 26. An integrated pharmaceutical company had fixed the price band in the range of Rs 426 to Rs 448. The minimum order lot is 33.

The 570-crore IPO comprises of fresh issue of equity shares worth up to Rs 320 crore and an offer-for-sale of Rs 250 crore, up to 55.80 lakh equity shares by promoters and selling shareholders.

Objects of the Issue

Fresh issue:

• Repayment and / or prepayment in part or in full, of certain outstanding loans of the company.

• Investment in the Subsidiary, UML, for repayment and / or prepayment in part or full of outstanding loans availed by UML.

• Funding the working capital requirements.

• General corporate purposes

About the company

Innova Captab is a pharmaceutical company operating in three business segments. Firstly, it provides contract development and manufacturing services to Indian pharmaceutical companies.

Secondly, the company has a domestic business dealing in branded generics. And thirdly, the company has an international business that deals in branded generics.

The company’s diverse generics product portfolio of over 600 products is marketed in India through an extensive network of distributors, stockists, and retail pharmacies.

At the upper price band company is valued at price/earning of 48.6 times with a market cap of Rs 33,074 million post issue of equity shares.

We believe that valuations of the company is fairly priced and recommend a 'Subscribe-Long Term' rating to the IPO.

Click on the attachment to read the full IPO report:

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