Concord Biotech, a pharmaceutical ingredients maker, made a strong stock market debut on Friday with its shares listing at a 21% premium to its initial public offering price and closing even higher.
The shares opened at Rs 900.05 on the BSE, which was also the day's low, and hit an intraday high of Rs 987.70, up 33.3% from the issue price of Rs 741 apiece.
The stock closed 27.11% higher at Rs 941.85, giving the company a market capitalization of Rs 9,853 crore ($1.19 billion)
The benchmark BSE Sensex ended the day 0.3% lower.
The strong debut comes after the company’s Rs 1,551-crore IPO was covered almost 25 times. Demand for the company’s shares was led by qualified institutional buyers, who bid for nearly 68 times the shares set aside for them. Non-institutional investors placed bids for 17 times their quota.
The IPO comprised only an offer of sale by healthcare-focused private equity firm Quadria Capital and didn’t include any fresh issue of shares. Quadria sold its entire 20% stake in Concord and clocked a modest annualised return on its investment, VCCircle reported in July.
Concord’s trading debut comes at a time when Indian benchmarks have fallen from record highs reached in the first half of the year due to slowing inflows from foreign institutional investors, fears of another rate hike by the US Federal Reserve, and growth concerns in China.
The biopharmaceutical company manufactures fermentation-based bulk drugs across immunosuppressants and oncology. It supplies to over 70 countries including the United States, Europe and Japan.
Its installed fermentation capacity was 1,250 cubic meters as of March 31, 2023. It recorded sales of Rs 713 crore and a net profit of Rs 175 crore for the fiscal year that ended on March 31, 2022. During FY23, these figures increased to Rs 853 crore and Rs 240 crore, respectively.
The stock also received a boost in sentiment throughout the day due to the favorable inspection report from the US FDA regarding Company's Manufacturing Unit III in Kheda, Gujarat. This inspection, which took place from June 26-30, was carried out by the United States Food and Drug Administration.