Medicamen Organics IPO make a bumper debut, shares list at 305% premium

Medicamen Organics IPO: Shares of small and medium enterprise (SME) Medicamen Organics Ltd made a spectacular trading debut on Friday, June 28, listing at an over 305% premium on the NSE Emerge platform.

The Medicamen Organics stock opened the session at ₹137.85, up 305.4% or over four times compared with its initial public offering (IPO) of ₹34. Within minutes of trade though, the stock hit the 5% lower circuit at ₹131 levels.

Since the minimum bid quantity or lot size, in the Medicamen Organics IPO was 4,000 shares, successful bidders who were allotted shares in the public issue would be sitting on a profit of at least ₹4.15 lakh (₹103.85 x 4,000) as soon as trading began in the SME stock.

The pharmaceutical manufacturer had seen an overwhelming response from investors when its ₹10.54-crore IPO opened for subscription from June 21 to June 25.

The Medicamen Organics IPO was oversubscribed by a massive 993.5 times, garnering huge interest from investors across categories.

While the portion reserved for non-institutional investors (NIIs) saw an oversubscription of 1,344 times, the retail investors’ quota was overbid by 1,310 times. The qualified institutional buyers’ category was oversubscribed by 173 times.

To recall, the Medicamen Organics IPO was a 100% book-built issue of 31 lakh shares of face value of ₹10 each that aimed to raise a total of ₹10.54 crore.

Medicamen Organics had said that it aimed to utilise the net proceeds from the IPO for funding expenses for product registration in international markets, updating the plant and increasing production capacity, meeting the company’s working capital requirements and addressing general corporate purposes.

The price band for the IPO was fixed at ₹32-34 per share, with a lot size of 4,000 shares.

Kfin Technologies Ltd was the issue’s registrar, while GYR Capital Advisors Pvt. Ltd is the book-running lead manager for the issue.

Ahead of the launch of the IPO, Medicamen Organics IPO had also raised ₹2.98 crore from anchor investors. The company issued 876,000 shares to two investors – Rajasthan Global Securities Pvt. Ltd and SB Opportunities Fund I – at a price of ₹34 apiece.

Established in the year 1995, Medicamen Organics is engaged in manufacturing pharmaceutical dosage forms such as tablets, capsules, oral liquids, and ointments. The company owns and operates two WHO-GMP-certified plants in Haridwar.

It is associated with many domestic and international companies such as Morepen, Anglo-French, Elder, Bestochem, Shreya Lifesciences, Wipro, Win Medicare, Jagsonpal, Klitch Drugs, Tablet India Ltd, Mission Pharma, SH Pharmaceuticals, Knoll, Healing, May and Baker and Emami, among others.

The company recorded revenue of ₹25.3 crore in 2023-24, up over 10% compared with ₹22.96 crore in 2022-23. Profit after tax (PAT), meanwhile, rose by a much sharper 151% to ₹2.4 crore in FY24 compared with ₹95.78 lakh in FY23.

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