Mumbai-based pharmacy chain Wellness Forever Medicare Pvt. Ltd said Monday it has raised Rs 130 crore ($17.5 million) ahead of a planned initial public offering.
The company secured the capital from Allana Group and Adar Poonawalla, CEO at vaccine maker Serum Institute of India Pvt. Ltd, it said in a statement.
VCCircle had first reported in July that the company was in late-stage discussions to raise equity capital from Allana Group.
Allana Group already owns a 0.79% stake in Wellness through a unit, as per VCCEdge, the data research platform of Mosaic Digital. Serum Institute owns about 15% and is the largest investor of Wellness after its founders.
The pharmacy chain said it received investment interest from several private equity funds but decided to go with existing investors given their expertise in consumer goods, retail and pharmaceutical sectors.
Wellness Forever also said that it has hired investment bank JM Financial Ltd for a secondary share sale for its early investors and for pre-IPO preparations.
Allana Group is one of India’s largest exporters of processed food products and agricultural commodities, including frozen meat, processed and frozen fruit and vegetable products, coffee, spices and cereals.
Apart from Allana and Poonawalla, Wellness Forever’s other existing investors include banker Rajiv Dadlani and venture capitalist Sajid Fazalbhoy. The company is promoted by Gulshan Bakhtiani, Ashraf Biran and Mohan Chavan.
The company says it has been profitable since its inception. It employs over 4,000 people, including over 800 pharmacists, and claims that it has more than one million paid customers.
Wellness Forever said it will use the fresh capital for store expansion, strengthening its profitable private label brands under unit Amore, which focuses on wellness and health products, and invest more in e-commerce.
The company said it already has an online-to-offline strategy and plans to adopt a hyperlocal delivery model to expand its e-commerce and tele-commerce businesses.
“With this round of funding, we plan to strengthen our private labels that have gained popularity over the years,” founder Gulshan Bhaktiani said. “We will continue to add more retail stores and reach out to our customers not just through brick-and-mortar outlets but also through online channels.”
The decade-old company has expanded its footprint to over 200 stores in Maharashtra, Goa and Karnataka. It aims to add over 150 more stores in the next year and 1,000 retail outlets in the next three years.
The company expects to clock revenue of over Rs 1,000 crore for the current fiscal year and said it is on track to achieve annual sales of around 4,000 crore over the next three to four years.
To discuss the business opportunity and the challenges in the healthcare sector, VCCircle is organising the Healthcare Investment Summit 2020—a virtual event—on December 11. Check out the details and register click here https://healthcare.vccevents.com/