Emcure Pharma raises ₹582 crore from 48 anchor investors ahead of IPO launch

A day before the launch of its initial public offering (IPO), Pune-based Emcure Pharmaceuticals Ltd raised over ₹582 crore from anchor investors.

Pune-based Emcure Pharmaceuticals saw significant interest from institutional investors. In a stock exchange filing, the company informed that it has allocated nearly 57.8 lakh shares to 48 anchor investors at a price of ₹1,008 apiece.

The anchor book included names such as HDFC Mutual Fund, SBI Mutual Fund, ICICI Pru ICICI Pru MF, Goldman Sachs Asset Management, Morgan Stanley, Nomura, and Abu Dhabi Investment Authority.

Emcure Pharma IPO subscription opens for public investors on July 3.

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What is anchor book allocation in an IPO?

An anchor investor is essentially a qualified institutional buyer (QIB) in an IPO that invests in an issue before it is made available to the public.

As the name suggests, this investor acts like an ‘anchor’ to a public issue as it is the first buyer in an IPO and provides cues to other investors.

The concept of an anchor investor was introduced in India in 2009 by the market regulator Securities and Exchange Board of India (Sebi).

According to Sebi guidelines, anchor investors are allocated a portion from the QIB quota of an IPO during the book-building process. Anchor investors need to invest at least ₹10 crore in a public issue. Additionally, they cannot offload any allotted shares before the completion of 30 days of listing. After 30 days, they can sell half their stake and the remaining half can be offloaded only after 90 days.

This commitment from anchor investors gives confidence to small retail investors as well as large players to invest in an issue.

Also Read: Shark Tank India judge Namita Thapar likely to earn ₹127 cr from Emcure Pharma IPO

About Emcure Pharma IPO

Emcure Pharma IPO is open for subscription. The IPO will close on July 5

The IPO is a 100% book-building issue valued at ₹1,952 crore. The company has fixed the price band of the offer at ₹960 to ₹1,008 per share, with a lot size of 14 shares.

This means that retail investors need to bid for a minimum of 14 shares, aggregating into a minimum application amount of ₹14,112.

The Emcure Pharma IPO combines a fresh issuance of 79 lakh shares, aimed at raising around ₹800 crore, along with an offer-for-sale (OFS) of 1.14 crore shares worth ₹1,152 crore.

The company has reserved 50% of the net issue for QIBs, 35% for retail investors and 15% for non-institutional investors.

The Emcure Pharma IPO shares allotment status is likely to be decided by July 8. After this, the refunds will be initiated for unsuccessful bidders and successful bidders will receive shares of the company in their Demat accounts on July 9. The shares are likely to list on the National Stock Exchange of India (NSE) and BSE on July 10.

Notably, Emcure Pharma is a leading manufacturer of pharmaceutical products sold globally in 70 countries. Established in 1981, the Pune-based firm is engaged in developing, manufacturing, and marketing a broad range of pharmaceutical products across several major therapeutic areas.

The company said that it will use the money raised via the fresh issue of shares in the IPO to settle its borrowings. A part of the proceeds from the offer will also be used for general corporate purposes.

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