Mankind Pharma Limited IPO
i. Mankind Pharma is India’s fourth largest pharmaceutical company in terms of Domestic Sales and second largest in terms of sales volume for the Financial Year 2022.
ii. The company is engaged in developing, manufacturing and marketing a diverse range of pharmaceutical formulations across various acute and chronic therapeutic areas, as well as several consumer healthcare products.
iii. They have created 36 brands in its pharmaceutical business that have each achieved over ₹500.00 million in Domestic Sales in the Financial Year 2022.
iv. They are present in several acute and chronic therapeutic areas in India, including anti-infectives, cardiovascular, gastrointestinal, anti-diabetic, neuro/CNS, vitamins/minerals/nutrients and respiratory. Mankind Covered Market presence in the IPM has increased from approximately 62% to approximately 64% between the Financial Years 2020 and 2022v
v. Mankind entered the consumer healthcare industry in 2007 and have since established several differentiated brands in the condoms, pregnancy detection, emergency contraceptives, antacid powders, vitamin and mineral supplements and anti-acne preparations categories. Their total Covered Market for its consumer healthcare business amounted to ₹203.60 billion for the Financial Year 2022
vi. The company has a pan-India marketing presence, with a field force of 11,196 medical representatives and 3,195 field managers, as of March 31, 2022. They have also established a significant distribution network in India and, during the Financial Year 2022, the company sold its products to over 11,000 stockists and engaged with 75 clearing and forwarding (“C&F”) agents.
vii. They operate 23 manufacturing facilities across India and had 2,181 manufacturing personnel.
i. Scaled domestic-focused business with potential for further growth
ii. Growing faster than the rate of the IPM with a focus on volume-led growth
iii. Established and growing consumer healthcare franchise with brand recall
Objects of the Mankind Pharma Limited IPO:
Mankind Pharma Limited IPO Details:
|Open Date:||Apr 25 2023|
|Close Date:||Apr 27 2023|
|Face Value:||₹ 1 Per Equity Share|
|Issue Type:||Book Built Issue IPO|
|Issue Size:||4,326.36 Cr.|
|Lot Size:||13 Shares|
|Issue Price:||₹ 1060-1080 Per Equity Share|
|Listing Date:||May 08 2023|
Promoters And Management:
Financials of Mankind Pharma Limited IPO:
|Equity Share Capital||₹40.05||₹40.05||₹40.05|
|Fixed Assets Block||₹1,498.82||₹15,657.10||₹1,652.36|
|Total Non-Current Assets||2251||16186||4741|
|Cash and Cash Balance||₹419.88||₹700.74||₹405.94|
|Total Current Assets||₹2,822.21||₹3,906.64||₹4,406.82|
|Particulars (In Crores)||2020||2021||2022|
|COGS % of Sales||32.02%||28.65%||31.12%|
|Employee Benefit & Other Expenses||₹2,550.35||₹2,785.72||₹3,370.47|
|S&G Sales %||43.48%||44.83%||43.31%|
|Interest %of Sales||0.37%||0.32%||0.75%|
|Dep %of Sales||1.69%||1.91%||2.14%|
|Earnings Before Tax||₹1,426.21||₹1,679.92||₹1,960.16|
|EBT % Sales||24.32%||27.03%||25.19%|
|Share of Net Profit of Associate and Joint Ventures||11.53||11.67||14.49|
|Effective Tax Rate||26.76%||23.73%||26.61%|
|No. of Equity Shares||40.05||40.05||40.05|
|Earning Per Share||₹26.37||₹32.29||₹36.28|
|EPS Growth %||0.00%||22.43%||12.37%|
|Dividend Per Share||₹9.10||₹0.00||₹0.00|
|Dividend Payout Ratio||34.49%||0.00%||0.00%|
Comparison With Peers:
|Peers||Debt||EV||Sales||EV / EBITDA||P/E|
Recommendation on Mankind Pharma Limited IPO:
Review and Recommendation of Mankind Pharma by IZ Team is 5/101. Mankind Pharma is India’s 4th largest Pharma company in terms of domestic sale and they are market leaders in some products like Male Condoms having brand Manforce, Pregnancy Detection kit Preganews, and contraceptive pills like Unwanted-72. 2. 34% of the total revenue of Mankind Pharma comes from Chronic diseases and rest 66% comes from acute diseases. 3. The company has a pan-India marketing presence, with a field force of 11,196 medical representatives and 3,195 field managers, as of March 31, 2022. They have also established a significant distribution network in India and, during the Financial Year 2022, the company sold its products to over 11,000 stockists and engaged with 75 clearing and forwarding (“C&F”) agents. 4. It is a pure OFS, it means company will not get anything in this IPO. The existing shareholders like Ramesh Juneja, Rajeev Junega, Sheeta Arora and Some funds are selling shares worth Rs.4300 Crores in this IPO. 5. The revenue of Mankind Pharma has grown from 5865 Crores in Fy20 to 7781 Crores in Fy22 thereby registering at CAGR growth of 15.18%. 6. They have EBITDA margins of around 25% which is pretty decent. 7. PAT has grown from 1000 Crores in Fy20 to 1400 Crores in Fy22. 8. 9MFy23 PAT is ~1000 Crores, so if we annualise it, the PAT would be ~1300 Crores. EPS would be 32, P/E 34x which looks over valued as compare to median P/E of Pharma Peers at 25x.