Private equity major ChrysCapital is investing Rs 300 crore ($56.2 million) in Ahmedabad-based Intas Pharmaceuticals Ltd, increasing its existing stake of 11.2 per cent in the fast-growing pharma company. With this investment in place, Intas has deferred its initial public offering (IPO) where it planned to raise Rs 425 crore in fresh capital besides a secondary sale.
“The company has deferred its listing plan for the time being and intends to re-file for an IPO once market conditions stabilise,” a statement said. ChrysCapital, which invested Rs 48 crore for 11.2 per cent stake in 2005, had plans to make a partial exit from Intas in the IPO.
While ChrysCapital III LLC, a $258 million fund, made the initial investment in 2005, the current one was made by ChrysCapital V LLC, a fund with $950 million under management. “As an existing investor in the company, ChrysCapital has benefited significantly from the strong performance recorded by Intas over the past six years. Consequently, this investment comes at a significant multiple to the 2006 investment,” the statement added.
ChrysCapital has also made other bets on the pharmaceutical space and invested in companies like Mankind Pharma and Eris Lifesciences.
Intas develops, manufactures and markets formulations including bio-pharmaceuticals. The company is present in more than 50 countries, with exports constituting around 40 per cent of its total revenues. In India, the majority of its revenues are coming from chronic therapy areas like cardio and central nervous system.
Intas is expected to generate revenues of Rs 2,700 crore during FY12. According to its DRHP, it had total revenues of Rs 1,626 crore, with net profit of Rs 206 crore for the year ended March 2010, and revenues of Rs 925 crore, with net profit of Rs 126 crore for the six months ended September 2010.
It had also outlined a capex plan of Rs 327 crore in its DRHP. The company has plans to use Rs 108 crore as registration fees for the products under development while Rs 218 crore will be used to modernise and expand certain manufacturing facilities, including setting up new blocks and units, expanding R&D facility and acquiring office space in Ahmedabad and Mumbai.
“ChrysCapital has been an integral part of our journey and has played an important role in determining our business strategy along the way. We greatly value ChrysCapital as an investment partner and look forward to extending our association further,” said vice-chairman & MD Binish Chudgar.
“Intas has demonstrated impressive historical growth and profitability, and is poised for significant growth in the years ahead. The company has gained market share in a fast-growing domestic market and successfully scaled up its international business at the same time,” said Sanjiv Kaul, ChrysCapital’s nominee on the board of Intas.