Emcure Pharma shares jump over 4% post listing. Should you buy, sell or hold?
Pune-based Emcure Pharmaceuticals listed at Rs 1,325, a 31.4% premium on Rs 1,008 IPO price. QIBs subscribed 195.8 times, non-institutional investors 48.3 times. Analysts recommend long-term holding. IPO proceeds target debt and corporate purposes. Offering products in therapeutic areas, Emcure recorded Rs 6,658 crore revenue in FY24 and operates in Europe, Canada.
The shares of jumped 4% to Rs 1,384 after a strong debut on the exchanges on Wednesday. The stock is listed at Rs 1325 on NSE and BSE over the IPO price of Rs 1008 apiece, a premium of Rs 317 or 31.4% as against the issue price.The enthusiastic listing was kind of expected after it received an overwhelming response, as the issue was subscribed to a whopping nearly 68 times.
The qualified institutional investors (QIB) led the pack, subscribing 195.8 times their allocation. Non-institutional investors followed closely, buying 48.3 times their portion, while the employee component showed strong interest by subscribing 8.81 times the reserved portion.
Analysts advised investors to hold the position for healthy returns in the long term.
"'s listing performance is positive, which aligns with pre-listing anticipation. The strong investor response and listing gain demonstrate confidence in the company's future potential. However, the identified risks within the pharmaceutical industry necessitate ongoing monitoring by investors. Investors may hold their positions by keeping a stop loss at 1200," said Shivani Nyati, Head of Wealth, Swastika Investmart.
Pune-based firm Emcure Pharmaceuticals is engaged in developing, manufacturing, and globally marketing a broad range of pharmaceutical products across several major therapeutic areas.
The research and development driven company with a differentiated product portfolio that includes orals, injectables and biotherapeutics with target markets across over 70 countries including a presence in India, Europe and Canada.
The company proposes to use the net proceeds from the fresh issue to be used towards the payment of debt and for general corporate purposes.
The global pharmaceutical market is expected to sustain growth at a compound annual growth rate of approximately 5.0% to 5.5% between the calendar years 2023 and 2028, to reach approximately $1,900 billion (approximately Rs 157 lakh crore) to $1,950 billion (about Rs 161 trillion) in the calendar year 2028.
In FY24, the company's revenue from operations grew 11% year-on-year to Rs 6,658 crore from Rs 5,985 crore in the preceding financial year. Meanwhile, profit after tax declined 6% year-on-year to Rs 527 crore from Rs 562 crore a year earlier.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
Source: Stocks-Markets-Economic Times
