In a note to investors, broking firm Ambit said Gland Pharma
lacks branding strength and innovator relationships compared to generic majors. But its execution track record and growth visibility overcomes these deficiencies. The note further said that the company had not received any warning letters from the US Food and Drug Administration (US FDA). In contrast, all generic majors have been red-flagged in their injectable units.
The Rs 6,480-crore IPO
of Gland Pharma
was one of the biggest by a pharma company in the domestic market. The issue managed to sail through on the back of institutional investor support, even as retail and HNI investors shunned the issue. Analysts had recommended Gland Pharma
citing its attractive valuations, healthy growth rates and margins. But the IPO
struggled to get through due to concerns, especially among HNI investors about the grey market premium. Ahead of its listing, the grey market premium soared.
“Gland Pharma is a niche player, focused on injectables. It has a proven track record of growth and profitability along with a consistent regulatory compliance history. The prospects are bright as it has 267 Abbreviated New Drug Application (ANDA) filings, of which 215 are approved. The pharma sector is in focus and, given its strong fundamentals and promising future, there is a lot of investment interest,” said Hemang Jani, head, equity strategy, broking & distribution, Motilal Oswal Financial Services.
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