Insightful Analysis: Unveiling the Indegene IPO

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  • 03 May 2024
Insightful Analysis: Unveiling the Indegene IPO

Key Highlights:

  • Indegene Ltd, a life sciences commercialisation company, has come out with its IPO with an issue size of Rs 1841.76 crores

  • The book-building IPO consists of fresh issues and offer for sale

  • Over the years, the company has recorded impressive returns on equity, total assets and net revenues


As Indian stock exchanges, the Bombay Stock Exchange (BSE) and the National Stock Exchange (BSE), touch new highs, investors’ confidence in the Indian growth story is evident. Several companies are looking to cash in on this optimism by going public, and Indegene Ltd is one of them.

Founded in 1998, Indegene Ltd is a life sciences commercialisation company. It offers digital-led commercialisation services for the life sciences industry, including medical device companies and biopharma. With its healthcare domain expertise and technological prowess, the company assists life science companies in clinical trials, aids in launching their products in the market and supports their safety and regulatory operations. Enabling life science and healthcare institutions to be future-ready, the company has a global presence with 17 offices and 5000+ worldwide team members.

Indegene Ltd has come out with its IPO. The table below captures other key details of the IPO:

Issue size Rs 1841.76 crores
Face value
Rs 2
Minimum investment
Rs 14,916
Total shares offered
40,746,891
Fresh issue
1,68,14,159
Offer for sale
23, 932,732
Issue price
Rs 430 - Rs 452
Lot size
33
IPO type
Book building
Listing on
BSE and NSE
Listing date
13th May

The company plans to use the funds obtained from fresh issues to:

  • Fund its capex requirements
  • Repay and prepay debt of its subsidiary, ILSL Holdings
  • Meet general corporate needs

Indegene boasts of impressive financials. The table below captures some of the key financials of the company that show its impressive performance across different financial years:

Particulars FY 23 FY 22 FY 21
Net revenues (in crores)
2,306.13
1,664.61
966.27
Profit after tax (in crores)
266.10
164.76
149.41
PAT margins
11.54%
9.90%
15.46%
Total assets (in crores)
2,203.87
1,353.47
596.04
Return on equity
25.02%
21.57%
46.04%
Earnings per share
11.97
7.46
8.74

The financials of the company reflect certain key things. These include:

  • A significant jump in net profits along with an impressive return on equity. A high return on equity shows that the company has been able to successfully convert its equity financing into profits.

  • The company's total assets and net revenues have considerably jumped. This reflects the company's acquisition of more resources with time and its effective management of expenses.

The life sciences industry, which includes biopharma and medical device companies, is a thriving sector. Its combined sales stood at USD 1.8 trillion in 2023 and are projected to reach USD 2.1 trillion by 2026. A growing population coupled with the increasing prevalence of chronic is a strong indicator of the sector's potential for growth in the coming days, offering a promising outlook for investors.

The company's unique business model and virtual monopoly position it for bright prospects in the future. Along with its strong domain expertise, its global delivery model can help it sustain its growth momentum in the future.

Summing it up

Before subscribing to a company's IPO, it's crucial for you to be well aware of the company's strengths and risks. Read the draft red herring prospectus for a complete overview and ensure you have holistic knowledge about your financial goals and risk appetite before subscribing.

Disclaimer: This article is for informational purposes only and does not constitute financial advice. It is not produced by the desk of the Kotak Securities Research Team, nor is it a report published by the Kotak Securities Research Team. The information presented is compiled from several secondary sources available on the internet and may change over time. Investors should conduct their own research and consult with financial professionals before making any investment decisions. Read the full disclaimer here.

Investments in securities market are subject to market risks, read all the related documents carefully before investing. Please read the SEBI prescribed Combined Risk Disclosure Document prior to investing. Brokerage will not exceed SEBI prescribed limit.

Source: RHP

FAQs

The issue size of Indegene IPO is Rs 1841.76 crores.

Yes, Indegene is a profitable company. Its profit after tax stood at Rs 266.10 crores in FY 23 from Rs 164.76 crores in FY 22, registering a growth of approximately 61.5%.

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