Innova Captab files draft papers with SEBI for IPO funding

The Haryana-based drugmaker, in terms of operating revenue, was the second largest formulation CDMO in India in Fiscal 2021 and the third fastest growing formulation contract development and manufacturing organization (“CDMO”) over the period Fiscal 2019 to Fiscal 2021.

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The company, in consultation with the lead bankers to the issue may consider a private placement or preferential issue of equity shares or any other method aggregating up to Rs 80 crore.

Innova Captab Ltd has filed its Draft Red Herring Prospectus (DRHP) with the markets regulator, Securities and Exchange Board of India (SEBI), to raise funds through an initial public offering (IPO).

The issue with a face value of Rs 10 per equity share consists of a fresh issue of equity shares worth up to Rs 400 crore and an offer-for-sale (OFS) up to 9,600,000 equity shares by Promoter and selling shareholders, which comprises of up to 3,200,000 by Manoj Kumar Lohariwala, up to 3,200,000 by Vinay Kumar Lohariwala (Promoter Selling Shareholders) and up to 3,200,000 by Gian Parkash Aggarwal (Other Selling Shareholders).

At present, promoters — Manoj and Vinay — hold 39.66 per cent and 30.08 per cent stake, respectively, in the company, while Gian owns a 30.23 per cent holding in the pharma firm. Moreover, the company may consider pre-IPO placement of equity shares aggregating up to Rs 80 crore. If such a placement is undertaken, the size of the fresh issue will be reduced.

Of the Rs 400 crore proposed to be raised through fresh issuance of equity shares, Rs 180.5 crore will be used for payment of debt, Rs 29.5 crore will be utilised for payment of loans availed by its subsidiary, UML, and Rs 90 crore for funding working capital requirements.

Innova Captab is an integrated pharmaceutical company in India with a presence across the pharmaceuticals value chain including research and development, manufacturing, drug distribution and marketing and exports.

The company’s business includes providing research, product development and manufacturing services to Indian pharmaceutical firms, domestic branded generics as well as international branded generics businesses. It has two manufacturing facilities in Baddi, Himachal Pradesh. ICICI Securities Limited and JM Financial Limited have been appointed as merchant bankers to manage the company’s IPO.

Innova Captab has an extensive network of over 96,000 retail pharmacies and above 3,400 distributors and stockists, with a diverse generics product portfolio manufacturing in excess of 400 items and markets under its own brands in the Indian market and exports its branded generic products to 17 countries.

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