Par Drugs and Chemicals Ltd

About the Company:

Par Drugs and Chemicals Ltd is engaged in the development and manufacture of Active Pharma Ingredients (“APIs”) for the domestic market as well as for exports to international markets.

Company’s product portfolio presently comprises 12 APIs and 6 Fine Chemical which are marketed domestically and exported. We supply our products to approximately 16 countries, including both direct and indirect exports.

Company’s key customers include Pfizer Ltd., Cipla Ltd., Cadila Healthcare Ltd., Meyer Organics Pvt. Ltd., Dabur India Ltd.

Company also produces various range of Antacid Molecules which are available in the market and are in great demand.

For Fiscal 2018, Company’s domestic and international operations accounted for 97.24% and 2.76%, respectively, of their total sales.

Company currently owns and operates two manufacturing facilities at Bhavnagar and Ankleshwar in the Gujarat.

 

What is Active Pharma Ingredients (“APIs”)?

APIs, also known as “bulk drugs” or “bulk actives” are the principal ingredient used in making finished dosages in the form of capsules, tablets, liquid, or
other forms of dosage, with the addition of other APIs or inactive ingredients.

 

Company’s Clients:

Par Drugs and Chemicals Ltd product portfolio presently comprises 12 APIs and 6 Fine Chemical which are marketed domestically and exported.

Company’s products to approximately 16 countries, including both direct and indirect exports. Our key customers include Pfizer Ltd., Cipla Ltd., Cadila Healthcare Ltd., Meyer Organics Pvt. Ltd., Dabur India Ltd.

 

Structure of Pharma Sector in India:

 

Management Team:

1. Mr. Falgun Vallabhbhai Savani (Designation: Chairman and Managing Director)
2. Mr. Jignesh Vallabhbhai Savani (Designation: CEO and Executive Director)

 

Objectives of the Issue:

• Funding the working Capital Requirements of the Company.
• General Corporate Purposes.

 

Strengths of the Company:

Wide Product Range:

Company product portfolio presently comprises 16 APIs and 7 Fine Chemical which are marketed domestically and exported. Company currently supplies its
products to approximately 12 countries, including both direct and indirect exports.

 

Global Presence:

Company is operating both in domestic and export markets and supplies its products to approximately 16 countries, including Germany, United Kingdom, Bangladesh, Iran, U.A.E etc.

Company has generated export revenue of Rs.1.16 crores for the year ended March 31, 2018 which is 2.37% of its total revenue from operations.

 

Diversified Customer Base:

During last year company catered to more than 200 customers worldwide, including some of the leading pharmaceutical companies like Pfizer Ltd., Cadila Pharmaceuticals Ltd., Meyer Organics Pvt. Ltd., Dabur India Ltd., The Himalaya Drug Company.

 

Established Sales and distribution network in in various states.

Company’s sales and distribution network is strategically spread across different regions such as Gujarat, Himachal Pradesh, Maharashtra, Tamil Nadu, West Bengal, Uttarakhand, Punjab and Delhi which comprising of more than 40 dealers.

 

Key Future Growth Drivers for the API Industry:

Benefits from Jan Aushadhi Scheme:

Presently, the generic drugs market is dominated by branded generic drugs. This is causing a hindrance to the sales of unbranded generic drugs by small or medium scale manufacturers in India.This in turn affects the generic drug API market.

However, the revival of Jan Aushadhi Scheme and Free Essential Drug scheme by the state & central governments would prove to be an opportunity for the domestic generic API manufactures to conquer the generic drug API market.

 

Scope for Growth if dependence on API Imports is Reduced:

Of the total domestic consumption, approximately 32% is imported. Of the total imports, China alone accounts for 57-60% of the APIs imported by India. The remaining imports are from countries such as Italy, Germany, Malaysia, and others.

These facts indicate that there is plentiful scope for the domestic. API market to grow, if the manufacturers are able to produce the required amount of APIs on their own, rather than importing it from other countries.

 

Financials of the Company:

(in Crores)	FY 16	FY 17	FY 18	30th Sept 18
Revenue	33.30	48.80	42.41	24.87
Net Profit	0.42	1.84	1.49	1.36

 

Valuation of Peer Group Companies:

Company Name	Face Value	EPS	PE Ratio	RoNW	NAV
Par Drugs & Chemicals Limited	10	5.54	9.20	10.00%	55.36
Aarti Drugs Ltd	10	30.67	21.71	16.95%	183.69
Shilpa Medicare Ltd	1	16.68	21.15	11.52%	141.91
Vasundhara Rasayans Ltd	10	20.51	1.77	47.46%	43.22

 

IPO Details:

Details	Info
Issue Opens on	3rd May 2019
Issue Closes on:.	8th May 2019
Issue Price	Rs.51
Face Value	Rs.10
Minimum Lot	2000
Minimum Investment	Rs. 1,02,000
Issue Constitutes	27.50%
Issue Size	Rs. 8.67 cr
Market Cap	Rs. 31.52 cr
Listing at	NSE SME
Equity Shares Offered (Fresh)	17,00,000
Equity Shares Prior to the Issue	44,80,318
Equity Shares after the Issue	61,80,318

 

IPO Valuation Parameters:

Earnings Per Share (EPS)	Price To Earnings ratio (PE)	Return on Net Worth (RoNW)	Net Asset Value (NAV)
5.54	9.20	10%	55.36

 

Check IPO Allotment Status:
Link InTime Website (Click on the below Link) https://linkintime.co.in/PublicIssue/

 

Company Contact Info:
PAR DRUGS AND CHEMICALS LIMITED 805, Dwarkesh Complex, R.C. Dutt Road, Alkapuri Vadodara- 390007, Gujarat, India Tel: +91 265 233208 Email: savani.falgun@pardrugs.com Website: www.pardrugs.com

 

IPO Registrar Info:
LINK INTIME INDIA PRIVATE LIMITED C-101, 1st Floor, 247 Park, L.B.S. Marg, Vikhroli (West), Mumbai – 400 083, Maharashtra , India Tel: +91 22 4918 6200 Email: pardrugs.ipo@linkintime.co.in Website: www.linkintime.co.in

 

Lead Manager to the Issue:
PANTOMATH CAPITAL ADVISORS PRIVATE LIMITED 406-408, Keshava Premises, Behind Family Court, Bandra Kurla Complex, Bandra East, Mumbai – 400 051, Maharashtra, India Tel: +91-22 6194 6700 Email: ipo@pantomathgroup.com Website: www.pantomathgroup.com