Corona Remedies' ₹655 Crore OFS IPO Opens Today. Brokerage Houses Advise 'Subscribe' Based on Strong Growth, New Hormone Plant, and Expanding Therapy Portfolio. GMP Also Shows Positive Signs.
IPO: Gujarat-based renowned pharmaceutical company, Corona Remedies, has opened its Initial Public Offering (IPO) to general investors today. The company aims to raise approximately ₹655.3 crore by selling a total of 6.2 lakh equity shares through this offer. This entire issue is an Offer for Sale (OFS), meaning no new shares are being issued by the company. Consequently, the funds raised from this IPO will directly go to the existing shareholders.
The company's promoter group includes Kirtikumar Lakshmidas Mehta, Minakshi Kirtikumar Mehta, Dipaben Niravkumar Mehta, and Brinda Ankur Mehta. Alongside them, several large investors are also selling their stakes, including investment firms such as Sepia Investments, Anchor Partners, and Sage Investment Trust.
The company has set the upper end of the price band for this offer at ₹1,062. Experts have based their recommendations on this valuation.
Company's Business Model
Corona Remedies is considered one of India's fast-growing pharmaceutical companies. The company holds a b position in chronic therapies, women's health medications, and hormone-based medicines. Robust demand is expected in all these segments for many years to come, making the company's growth story attractive.
In recent years, Corona Remedies has consistently launched new products and made several strategic acquisitions, further deepening its therapeutic presence. Additionally, the company has recently commissioned a new hormone manufacturing plant, which will bolster both its production capacity and profitability in the coming years.
Brokerage House Opinions
Arihant Capital's Rating
Arihant Capital believes that Corona Remedies has a very b long-term future. According to the brokerage, the company's growth is in segments where medical demand will continuously increase in the future. Furthermore, the company's capacity, network, and therapy lineup will support the next phase of growth.
Based on the upper price band of ₹1,062, Arihant Capital has calculated the company's P/E ratio at 43.5x, based on FY25 EPS of ₹24.4. Considering this valuation, the brokerage house has advised investors to 'Subscribe' to the IPO.
SBI Securities' Recommendation
SBI Securities has also identified the company as a b growth pharmaceutical firm. According to them, Corona Remedies has demonstrated excellent financial performance between FY23 and FY25. During this period, the company recorded an average annual growth of 16.3% in Revenue, 36.9% in EBITDA, and 32.6% in PAT.
SBI Securities believes that the company will expand its field force in the future, further strengthening its geographical reach. Investments in the hormone manufacturing plant will also bolster the company's next growth phase. The P/E at the upper price band of ₹1,062 is 43.5x, which is in line with similar companies in the sector. For this reason, SBI Securities has also recommended investing at the cut-off price.
What Grey Market Premium (GMP) Indicates
According to unofficial sources, Corona Remedies' GMP appears b ahead of its listing. As of December 5th, the company's unlisted shares were trading at approximately ₹1,427. This suggests that the GMP is running at a premium of approximately ₹365, or about 34.4%. This can be interpreted as an indication of initial investor interest and potential listing gains.
However, GMP is unofficial and can change over time. Therefore, final decisions should always be made after considering the company's financial health, industry growth, and long-term potential.
