Gland Pharma IPO Review

Gland Pharma IPO happens to be one of the largest IPO in the Pharma space. Gland Pharma, which is controlled by Chinese pharma giant Shanghai Fosun Pharma, is all set to launch its IPO on November 9 to raise about Rs 6,500 crore. The price band for the offer has been fixed at Rs 1,490-1,500 a share. The issue will close on November 11.

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Gland Pharma IPO Details

Issue Period9th Nov – 11th Nov 2020
Anchor Investors6th Nov, 2020
Face Value₹ 1/-
Issue DetailsFresh Issue of Equity shares upto ₹ 1,250 Crores
+ Offer for Sale of upto 34,863,635 Equity Shares
Issue Size (₹ Cr)₹ 6,445 Cr – ₹ 6,480 Cr
Price Band₹ 1,490 – 1,500
Bid Lot10 Shares and in multiples
Issue Structure : 
QIB50% of the offer
NIB15% of the offer 
Retail35% of the offer ( 15,118,939 Shares- ₹ 2,268 Cr)
BRLMsKotak Mahindra Capital, Citigroup Global, Haitong Securities, Nomura Financial
RegistrarLink Intime India Pvt. Ltd.


  • ANCHOR ISSUE: Ahead of its IPO, Gland Pharma raised ₹1,944 crore from anchor investors at price of ₹1,500 per equity share. The anchor investors include Government of Singapore, Nomura, Goldman Sachs, Morgan Stanley, SBI Mutual Fund and Axis Mutual Fund etc.

About Gland Pharma

  • Gland Pharma Ltd. is a generic injectables focused company.
  • The Hyderabad based Gland Pharma was established in the year 1978 and has a footprint across the lobe. The company pioneered heparin technology in India in 1970s. Gland Pharma is now controlled by Fosun Singapore and Shanghai Fosun Pharma,
  • The company sells its products primarily under a business to business (“B2B”) model in over 60 countries as of 30th June 2020, including the United States, Europe, Canada, Australia, India and the rest of the world.
  • The company has 7 manufacturing facilities in the country which includes 4 finished formulations facilities with a total of 22 production lines and 3 API facilities.
  • The company has a manufacturing capacity for finished formulations of ~755 million units per annum.
  • As of June 30, 2020, along with its partners, the company had 267 ANDA filings in the United States, of which 215 were approved and 52 were pending approval.
  • As of June 30, 2020, it had workforce of 3,766. It also has an in-house R&D team

Gland Pharma: Financials

Particulars/ Rs. In crQ1FY21Q1FY20202020192018
Revenue from Operations884.21674.462,633.242,044.201,622.89
Revenue Growth (%)31.10%28.82%25.96%
EBITDA 444.7296.981,094.64792.07584.08
EBITDA (%) 50.29%44.03%41.57%38.75%35.99%
Profit Before Tax420274.33992.87686.28501.47
Net Profit 313.59183.77772.86451.86321.05
Net Profit Margin35.47%27.25%29.35%22.10%19.78%
EPS (₹ )20.2411.8649.8829.1620.72
Equity Share Capital15.515.515.515.515.5
Reserves 3,947.973,028.323,630.742,846.502,394.86
Net worth3,963.473,043.823,646.242,862.002,410.36
RONW (%)7.91%6.04%21.20%15.79%13.32%
NAV (₹ )255.79196.44235.32184.71155.56
Debt Equity Ratio0.0010.0020.0010.0020.002
Equity Post IPO16.33
IPO Price1500
EPS (Post IPO) FY2047.32
PE FY2031.70
Market Cap24500
Market Cap/sales9.3


  • Gland Pharma has extensive portfolio of complex products in injectable and across various therapeutic areas to cater growing demand.
  • It is also expanding its footprints in new geographies and investing large amount in manufacturing capabilities as well as R&D to keep order pipeline healthy.
  • The company has been growing at a fast pace.
  • The company has plans to expand into building fermentation capabilities in India.
  • Besides extensive and vertically integrated injectables manufacturing capabilities, Gland Pharma has a consistent regulatory compliance track record.


  • Gland Pharma sources most of the raw material from China.
  • Chinese firms could face -ve investor sentiments in India
  • The injectable manufacturing industry is heavily regulated.

Gland Pharma IPO: Assessment

  • Gland Pharma is the biggest IPO in Pharma sector so far.
  • As per IQVIA report Gland Pharma Ltd. is one of the fast growing generic injectables focused companies by revenue in the United States from 2014 to 2019.
  • The global injectable market estimated at US$432 billion in 2019 has been growing at a CAGR of approximately 10.1% from 2014 to 2019. Injectables constituted the largest means of drug delivery systems in USA accounting for about 46% of the total pharma pie.
  • Fosun Pharma, the Chinese giant, in 2017, had acquired 74% stake in Gland Pharma, which was founded by PVN Raju in 1978. after tyhis IPO Fosun Pharma’s holding will go down to 58% while PVN Raju holding will decline to 9.9%.  
  • ED has recenly asked Gland Pharma To Transfer 6 Million Shares Held by Ramalinga Raju to Escrow Account
  • Gland Pharma has strong presence in B2B business which contributes 96-98% of its revenue.
  • It has 4 US FDA approved formulation facility and 3 captive API plants in South India, with 267 US ANDA filings (with partners), of which, 215 are approved.
  • US accounts for 66% of revenue of Gland Pharma. The company intends to add on China, the 2nd largest generic injectable market,
  • The company has strong support from parent chinese company.
  • Injectables have high entry barriers.
  • Gland Pharma’s EBITDA and PBT grew at a 37% and 41% CAGR between FY18-20 respectively.
  • Gland Pharma has successfully leveraged digital technology which can propel its growth futher as well.
  • Lackluster performance of recently-listed stocks has hurt expectation of listing gains.
  • The imminent threat faced by the company arises from negative sentiments for China.
  • Most of the raw material are sourced from China.
  • Not only India, but several countries like the US, UK, Germany, France,Japan have started cutting their deals with China. This is a major concern for the future outlook of the company.
  • Gland Pharma is seeking a PE multilple of about 31.7x times its FY 2020 Eearnings on a post-issue equity share capital of Rs 16.33 crore of face value of Rs 1 each. This is not too high for a high growth company but the possible impcat of Chinese connection is something that is not easy to figure out at this juncture.
  • Gland Pharma is not commanding much actvity in the grey market.
  • A good degree of caution is needed for ths IPO. I intend to apply in Gland Pharma IPO only after seeing the response which could be as late as day 3. As of now it looks retail may get full allotment if the IPO is able to garner reasonable response form Institutions.
  • Do check this page for any last minute updates

Standard disclaimer:  I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . Also Certified in some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2)  Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors.  I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or  leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.

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