India's Emcure Pharmaceuticals drew strong interest for its $234 million initial public offering (IPO) as investors bet on its slate of women's healthcare and HIV treatments to drive growth in a high-margin market.
The Bain Capital-backed company's IPO was fully subscribed on the first day of bidding and over the three-day process, it got bids worth up to 937.11 billion rupees ($11.23 billion), nearly 68 times the amount on offer, exchange data showed.
Bain sold nearly a third of its 13.07% stake in Emcure, with existing investors overall selling shares worth 11.52 billion rupees.
Emcure raised 8 billion rupees by issuing new shares in the IPO, which valued the company at up to 190.60 billion rupees, per Reuters calculations.
Emcure is going public in India's red-hot IPO market where more than 100 companies have raised around $4.6 billion through IPOs so far this year, more than double the same period last year, as per LSEG data.
Analysts are betting on its focus on areas such as gynaecology, where it has a market-leading 14% share, and HIV treatments. The generics market is dominated by firms such as Sun Pharma, Mankind Pharma, Torrent Pharma and Abbott India.
Institutional buyers, including foreign investors, banks and mutual funds, bid for 196 times the shares on offer, while retail investors bid for seven times their reserved shares.
Anchor investors, including Goldman Sachs and Abu Dhabi Investment Authority (ADIA), had earlier bought shares worth a total of 5.83 billion rupees.
Emcure's expansion-related spending has hit earnings over the last two years but the ramp-up of facilities will boost sales in the near term, said Sneha Poddar, vice president of research at Motilal Oswal Financial Services.
The stock's price-to-earnings ratio of 36.6 is also attractive compared to the industry average of 40.4, and can help it "pop" in its trading debut, analysts said.
