India’s Emcure Pharmaceuticals aims to raise $400-500 million from an initial public offering planned for next year, two sources said, reviving listing plans the drugmaker shelved in early 2022 as the Ukraine war roiled global markets.
Emcure, backed by private equity firm Bain Capital, has hired investment banks JP Morgan, Jefferies and Kotak for the IPO, and is targeting a valuation of about $3 billion, both sources with direct knowledge of the matter said.
Bain, which owns 13% in the company, plans to sell a part of its stake, the first source said.
Bain and Jefferies declined to comment while Emcure, Kotak and JP Morgan did not respond to requests for comment.
Emcure is among companies looking to capitalise on the world’s most populous country’s increasing need for medicines and a growing health awareness among citizens.
India’s pharmaceuticals market is expected to reach $130 billion in 2030 from $50 billion currently, and deal-making in the sector is booming.
Founded in 1981, Emcure says it is India’s 13th biggest drugmaker, and present in more than 70 countries, including Canada, the United Kingdom and Thailand.
It had planned to list and raise up to $672 million in early 2022, and received regulatory approval to go ahead, but shelved the plans as stock markets fell in the wake of Russia’s invasion of Ukraine and rising interest rates.
Now it plans to file draft IPO papers with the regulator by the end of the year and list next year, both sources said.
The company sells medicines in areas such as gynaecology, cardiology, anti-infectives (medicines that can inhibit or kill foreign organisms that cause infection) and vitamins, in addition to vaccines and has 14 manufacturing plants in India.
In the fiscal year to March 2022, Emcure’s income from operations grew 16% to $698 million, according to rating agency CareEdge Ratings. About 45-55% of Emcure’s revenues are from India, the agency said.
Emcure’s renewed plans come as India’s main stock indices – SENSEX and NIFTY – are near record highs driven by strong domestic and foreign fund flows.
The pharmaceutical sector is also seeing a flurry of deal activity with record valuations. Drugmaker Torrent Pharma is in talks to acquire larger rival Cipla for an estimated $7 billion, in what could be the country’s biggest ever pharma deal.
Glenmark last week sold its life sciences unit to detergent maker Nirma for $680 million.
Reuters