Mankind Pharma To Raise Rs 10,000 Crore Via Debt Issue
Funds will be raised through non-convertible debentures and commercial papers on private placement basis.
(Mankind Pharma's manufacturing facility in Himachal Pradesh. Source: Company website)
Mankind Pharma Ltd. will raise up to Rs 10,000 crore via issue of debt instruments. The board on Friday approved the plan to raise funds through non-convertible debentures and commercial papers on a private placement basis.
India's fourth-largest pharmaceutical company received the board's clearance in May for a Rs 7,500-crore equity fundraising plan. The board had also approved an increase in its borrowing limit to Rs 12,500 crore.
In July, the company announced a landmark deal to acquire a 100% stake in Bharat Serums and Vaccines Ltd. for an enterprise value of Rs 13,630 crore to expand its footprint in the specialty pharma sector. It also brings a whopping Rs 17,000 crore revenue potential for Mankind if the transaction is completed by next year.
Currently, the company's long-term borrowings stand at Rs 1,711 crore, with cash reserves of Rs 1,230 crore.
Earlier in the day, brokerage firm Investec rated Mankind Pharma stock "Buy," setting a target price of Rs 3,300 per share.
Investec attributed it to Mankind's strong market performance to its sales force of over 16,000 representatives and a portfolio of popular consumer brands, including Manforce and PregaNews. These brands have not only bolstered the company's reputation but have also contributed significantly to its market share, positioning Mankind as the second-largest player by volume in the Indian pharmaceuticals sector.
The acquisition of BSV is viewed as a pivotal move that aligns well with Mankind's vision of becoming an innovation-driven company focused on high-barrier specialty products. Investec believes BSV's strengths in research and development, particularly in women's health and in vitro fertilisation (IVF), will enhance Mankind's offerings in these critical areas. The IVF market alone is projected to reach $6 billion, presenting a significant opportunity for growth.
Shares of Mankind Pharma closed 4.78% higher at Rs 2547.15 apiece on Friday, ahead of the announcement, compared to a 1.65% rise in the benchmark Sensex.
