Concord Biotech debuted at a healthy premium of 21% on the exchanges on Friday. The stock listed at Rs 900 on NSE and BSE over the IPO price of Rs 741 apiece, a premium of Rs 159 as against the issue price.
Meanwhile, the stock further rallied 9.7% to Rs 987 in Friday’s intraday trade, taking the total gains to over 33%.
Analysts advised investors to book profits, while aggressive investors may hold and add stake for healthy returns in the long term.
“Concord Biotech is a leading API company with a proven track record. The company manufactures and exports APIs for a wide range of therapeutic areas. However, the company’s international operations expose it to various complex risks,” said Anubhuti Mishra, Equity Research Analyst at Swastika Investmart.
Mishra said the listing of Concord Biotech was in line with expectations.
“The company’s strong fundamentals and good subscription levels were positive factors for this. Investors who participated in the IPO should consider booking profits post listing,” Mishra added.
Prashant Tapse, VP-Research at Mehta Equities, said, “We advise a conservative allotted investor to book profits on listing, while a risk taker can hold and add more on the listing day for healthy returns on long term.”
“We like Concord’s business mix which is well placed in niche pharma space with leading market share in complex product portfolios along with strong customer relationships over 70 countries in both APIs and formulations with high entry barriers. We would continue to remain optimistic on long-term business dynamics,” Tapse added.
Concord Biotech is a biotechnology company and a leading maker of select fermentation-based APIs across immunosuppressants and oncology in terms of market share, based on volume in 2022.
The company is backed by Rakesh Jhunjhunwala’s Rare Enterprises and another leading investment firm Quadria Capital Fund.
It is present across the fermentation value chain, and supplies to over 70 countries including regulated markets, such as US, Europe and Japan, and India.
The IPO, which was completely an OFS, subscribed by 24.86 times at close. The qualified institutional buyer portion was booked the most with 67.67 times, non-institutional investors at 16.99 times, whereas, the retail category was subscribed 3.78 times.
The IPO was completely an offer for sale of 2.09 crore equity shares up, aggregating up to Rs 1,551 crore. The company had fixed the price band at Rs 705-741 per share for its public offer.
Concord recorded an 18% CAGR in revenue over FY21-23 with EBITDA margin of 40%. Its return ratios are healthy with RoE/RoCE of 20% and 19% and it generated free cash flow over the last two years with FCF/EBITDA at 29%.
For the year ended March 2023, the company’s revenues stood at Rs 888 crore and profit for the period was Rs 240 crore.
Kotak Mahindra Capital, Jefferies India, and Citigroup acted as the book-running lead managers and Link Intime India was the registrar for the IPO.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
(What’s moving Sensex and Nifty Track latest market news, stock tips and expert advice on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds.)
Download The Economic Times News App to get Daily Market Updates & Live Business News.
Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
