Windlas Biotech shares list at 5% discount

Windlas Biotech shares on Monday made a weak presentation at the bourses, posting at a discount of 5%, against the issue price of Rs 460.

Shares of the company recorded at Rs 439, lower by 4.56 percent from the issue price on the BSE. It further tumbled 11.46 percent to Rs 407.25.

On NSE, it recorded at Rs 437, a decay of 5%.

The initial public offer of Windlas Biotech, a manufacturer of pharmaceutical formulations, was bought in 22.46 occasions earlier this month.

The Rs 401.53-crore offer had a price range of Rs 448-460 for each share.

Shares of Windlas Biotech (WBL) made a disappointing presentation on Monday, as the shares of the company recorded at Rs 437, 5 percent underneath its issue price of Rs 460 on the National Stock Exchange (NSE). The stock of the pharmaceuticals company, meanwhile, opened at Rs 439 on the BSE.

At 10:19, WBL was trading at Rs 431, down 6 percent against the issue price on the NSE. The stock hit a high of Rs 452 and a low of Rs 405 so far in trade. A consolidated 1.9 million value shares have changed hands on the counter on the NSE and BSE.

The initial public offer (IPO) of WBL got a good reaction from the investors as the issue got bought in 22.44 occasions. The qualified institutional purchasers (QIBs) segment was bought in 24.4 occasions, the non-institutional investors (NII) or wealthy investor segment 15.73 occasions, and the retail segment 24.22 occasions.

The object of the issue was to purchase hardware needed for the capacity expansion of its current facility at Dehradun Plant IV. The company will net returns of the issue to finance incremental working capital prerequisites of the company and to repayment/prepayment of the company's borrowings.

WBL is a leading Contract Development Manufacturing Organization (CDMO) with an emphasis on the constant therapeutic category. With over two decades of involvement with manufacturing both strong and fluid pharmaceutical dosage structures, WBL gives a complete range of CDMO administrations including item revelation, item improvement, permitting and commercial manufacturing of conventional items.

The company's innovative arrangement of complex conventional items upheld by strong R&D capabilities, productive and quality compliant manufacturing facilities with significant section barriers, long haul relationships with Indian pharmaceutical companies and a steady track record of financial performance accommodates further development perceivability. On the valuation front, at the upper price band, the issue is aggressively priced at 64.4x P/E considering the weakened value shares and FY21 annualized earnings, brokerage firm BP Equities said in IPO note.

WBL is zeroing in on formulation CDMO and there is no friend company zeroing in exclusively on the CDMO model. "At the more exorbitant cost band of Rs 460, thinking about its return ratios and profitability, the issue is by all accounts completely priced. Be that as it may, factoring in the development drivers of the CDMO sector and openings available for the company, we assign a "Buy in for Long Term" rating for the issue," Choice Equity Broking said in the IPO update.