Bajaj Healthcare BSE SME IPO review (Subscribe)

Review By Dilip Davda on Apr 23, 2016

Bajaj Healthcare Ltd (BHL) is a pharmaceutical company with manufacturing and marketing capabilities in Active Pharmaceutical Ingredients (APIs), Intermediates and Finished Dosage Formulations (FDFs) with focus on Vitamins, Amino Acids, Anti-Convulsants and Finished Dosage Forms (FDFs) catering to various therapeutic segments.

Company’s present product portfolio consists of various APIs in the therapeutic categories of Neutraceutical (Amino Acids), Vitamins, Anti-Convulsants, Bactericidal & Bacteriostatic, Diuretic & Vasodilator, Mineral & Nutritional supplements, Bronchodilater / Anti-asthmatic and Nootropics. Its Formulations unit manufactures tablets, capsules and sachets for its own brands as well as under Loan License (job work) for other pharmaceutical companies. Currently, BHL manufactures formulations for GlaxoSmithKline Pharmaceuticals Limited (GSK) and USV Limited (USV) on a Loan License basis. The formulations manufactured for own brands are manufactured and marketed under a separate division of Bajaj Medicare and the company also have marketing tie-up with TTK Healthcare Limited. The FDFs manufactured by it cover various therapeutic segments like Antibiotics, Anti-Arrhythmia, Anti-Convulsants, Anti-Diabetes, Anti-Platelets, NSAIDs, Vitamins & its Derivatives, Anti-Hypertensive, Anti-Bacterial, Anti-Malarial, Cholinesterase Inhibitors, etc. Presently BHL is supplying APIs and FDFs both domestically and exporting to various countries in regions like, Europe, USA, Australia, Africa, South America, etc.

To part finance its debt repayment needs and to provide exit route to existing stakeholders, the company is coming out with a maiden IPO of 1817600 equity share of Rs. 10 each at a fixed price of Rs. 170 per share to mobilize Rs. 30.90 crore. The offer consists of 149600 primary issue and 1668000 secondary issue (i.e. offer for sale). Issue opens for subscription on 27.04.16 and will close on 02.05.16. Minimum application is to be made for 800 shares and in multiples thereon, thereafter. Issue is solely managed by Aryaman Financial Services Ltd and Sharex Dynamic (India) Pvt Ltd is the registrar to the issue. After initial equity contribution at par, it issued bonus shares in the ratio of 19 for 1 in January 2009 and in the ratio of 2 for 1 in January 2016. In October 2009 it issued equity at a price of Rs. 280 per share. Post IPO its current paid up equity capital of Rs. 6.75 crore will rise to Rs. 6.90 crore. Post allotment shares will be listed on BSE SME.

On performance front, the company has posted loss of Rs. 1.06 crore on a turnover of Rs. 170.90 for FY 13. Thereafter for FY 14 and FY 15 it has reported turnover and net profit of Rs. 205.01 cr. / Rs. 1.97 cr. and Rs. 218.38 cr. / Rs. 7.51 cr. respectively. For nine months ended 31.12.15 it has posted net profit of Rs. 6.45 crore on a turnover of Rs. 172.52 crore. It we attribute latest earnings on annualized basis on fully diluted equity post IPO then asking price is at a P/E of around 14 that sounds reasonable.

However, merchant banker has poor track record for its past mandates.


Conclusion / Investment Strategy

Risk savvy investors having surplus funds may consider investment for long term.

Reviewer recommends Subscribing to the issue.

Review By Dilip Davda on Apr 23, 2016

Review Author

DISCLAIMER: No financial information whatsoever published anywhere here should be construed as an offer to buy or sell securities, or as advice to do so in any way whatsoever. All matter published here is purely for educational and information purposes only and under no circumstances should be used for making investment decisions. Readers must consult a qualified financial advisor before making any actual investment decisions, based on information published here. With entry barriers, SEBI wants only well-informed investors to participate in such offers. With crazy listings in the past, SME IPOs drew the attention of investors across the board. However, as SME issues have entry barriers and continued low preference from the broking community, any reader taking decisions based on any information published here does so entirely at own risk. The above information is based on information available as on date coupled with market perceptions. The Author has no plans to invest in this offer.

(SEBI registered Research Analyst-Mumbai).


About Dilip Davda

Dilip Davda

Dilip Davda is veteran journalist associated with stock market since 1978. He is contributing to print and electronic media on stock markets/insurance/finance since 1985.

Dilip Davda is a leading reviewer of public issues and NCDs in the primary stock market in India. The knowledge he gained over 3 decades while working in the stock market and a strong relationship with popular lead managers makes his reviews unique. His detail fundamental and financial analysis of companies coming up with IPO helps investors in the primary stock market. Dilip Davda has a special interest in analyzing the SME companies and writing reviews about their public issues. His reviews are regularly published online and in news papers.

Email: dilip_davda@rediffmail.com

Bajaj Healthcare IPO FAQs

  1. 1. Why Bajaj Healthcare IPO?

    The initial public offer (IPO) of Bajaj Healthcare Ltd offers an early investment opportunity in Bajaj Healthcare Ltd. A stock market investor can buy Bajaj Healthcare IPO shares by applying in IPO before Bajaj Healthcare Ltd shares get listed at the stock exchanges. An investor could invest in Bajaj Healthcare IPO for short term listing gain or a long term.

  2. 2. How is Bajaj Healthcare IPO?

    Read the Bajaj Healthcare IPO recommendations by the leading analyst and leading stock brokers.

  3. 3. Bajaj Healthcare IPO what should investors do?

    Bajaj Healthcare IPO offers an opportunity to buy IPO shares before they get listed at the stock exchanges. Read the Bajaj Healthcare IPO Notes, Analysis and Recommendations by leading stock brokerage firms and experts in the above answer.

  4. 4. Is Bajaj Healthcare IPO good?

    Our recommendation for Bajaj Healthcare IPO is to subscribe.

  5. 5. Is Bajaj Healthcare IPO worth Investing?

    As per the analysis by our lead analyst Mr. Dilip Davda, we suggest you to subscribe to the Bajaj Healthcare IPO.

  6. 6. When will Bajaj Healthcare IPO allotment status?

    The Bajaj Healthcare IPO allotment status will be available on or around [.]. The allotted shares will be credited in demat account by [.]. Visit Bajaj Healthcare IPO allotment status to check.

  7. 7. When will Bajaj Healthcare IPO list?

    The Bajaj Healthcare IPO will list on Tuesday, May 10, 2016, at BSE SME.








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