Citi Pharma raises Rs2.32 billion in over-subscribed IPO

Shahnawaz AkhterWeb Editor

16th Jun, 2021. 09:03 pm
Citi Pharma

KARACHI: Citi Pharma has raised Rs2.32 billion in an over-subscribed book-building process of the company’s Initial Public Offering (IPO), according to the Topline Securities, adviser and book runner of the issue.

“The IPO received an overwhelming response from institutional investors and high networth individuals, as the strike price clocked in at Rs32/share, 14.3 per cent higher than the floor price of Rs28,” the leading API manufacturer of the country said in a statement.

Citi Pharma has raised Rs2.32 billion in total, making it the second pharma sector IPO in 23 years and the single largest IPO of 2021 to-date.

“The response to the book-building was far better than our expectations,” Mohammed Sohail of Topline Securities said. Several brokerage houses had issued almost unanimous calls to subscribe, which resulted in investors’ demand, amounting to Rs4 billion against the IPO’s book-building size of Rs2 billion. Investors who bid at Rs32 will get approximately 10 per cent of their bid quantity.

The general public will subscribe the remaining 18.1 million shares (25 per cent of the total offer size) on June 23/24 at the strike price of Rs32, the company said.

Rizwan Ahmed, CEO of Citi Pharma, in his message, thanked the investors for their overwhelming response and vowed to ensure growth of their shareholders’ equity.

Omar Salah Ahmed, head of corporate finance and advisory at Topline, said: “Citi Pharma is one of the most unique companies in Pakistan’s pharma sector and this expansion will bring in a new phase for the company. We wish them all the best for the future, as well as the investors – who will no doubt be a part of a great growth story. Investors have responded to the future growth.”

Citi Pharma plans to become the first fully-integrated listed pharmaceutical company in Pakistan, serving from raw material consumers to end medicine consumers. It has achieved a revenue growth of Rs3.528 billion in FY20, compared with Rs1.016 billion in FY16, showcasing 36.2 per cent Compound Annual Growth Rate (CAGR) in five years.

The company plans to expand its existing capacity of 3,600 tonnes/annum of paracetamol to 6,000 tonnes/annum. In addition, the company said it plans to add new APIs, as well as a pharmaceutical formulation, or final products, to its existing product line.

Citi Pharma also wants to build three manufacturing facilities, taking its total capacity to 200,000 vials/injectables/day, dry powder/suspension to 60,000 bottles/day, capsules to 4.2 million/day, and tablets to 4.5 million/day. These include dedicated manufacturing lines for penicillin, cephalosporin, and psychotropic and narcotics drugs.

Adsense 300 x 250