Onyx Biotec Ltd., a pharmaceutical company specializing in generic and proprietary products like Water for Injection (WFI), Dry Powder Injections, and Dry Powder Syrups, launched its IPO from November 13 to November 18, 2024. The IPO is entirely a Fresh Issue, raising ₹29.34 crores, priced between ₹58–₹61 per share.

The company aims to use the proceeds for manufacturing unit upgrades, packaging line setups, loan repayments, and general corporate purposes.

IPO Details

• Issue Type: Fixed Price IPO
• Subscription Period: November 13–18, 2024
• Lot Size: 2,000 shares
• Retail Investment Minimum: ₹1,22,000
• Listing: Shares will debut on NSE SME on November 21, 2024.

The IPO's market capitalization at the upper price band is ₹110.60 crores.

Company Overview

Onyx Biotec Ltd., established in 2009, develops, manufactures, and markets pharmaceutical products. The company has a robust distribution network and operates across India with a focus on quality and affordability.

The leadership team includes:

• Sanjay Jain (Co-founder, Promoter, and Managing Director): Over 16 years of industry experience.
• Naresh Kumar (Co-founder and Promoter): Expertise in marketing and operations.
• Harsh Mahajan and Lakshya Jain: Oversee manufacturing, marketing strategies, and finances.

Financial Performance

The company shows moderate growth with a pre-issue EPS of ₹2.54 and post-issue EPS of ₹1.67, translating to a pre-issue P/E ratio of 24.01x.

Subscription Status

• Final Day Subscription: Onyx Biotec IPO saw overwhelming demand, with 66.23x total subscription.
• Anchor Investors: Raised ₹8.33 crores by allocating 13.66 lakh shares at ₹61 per share.

Grey Market Premium (GMP)

Currently, the GMP stands at ₹0, suggesting negligible listing gains. This indicates the demand in the informal market may not significantly influence the listing price.

Allotment Details

• Allotment Date: November 19, 2024
• Investors can check their status via the registrar's (MAS Services Limited) website or the NSE portal.

Objectives of the IPO

The company plans to use the IPO proceeds as follows:

1. ₹607.70 lakhs: Upgrade Unit I for large-volume parental manufacturing.
2. ₹124.05 lakhs: Establish a high-speed packaging line at Unit II.
3. ₹1,200.00 lakhs: Prepay or repay existing loans.
4. General Corporate Purposes.

Brokerage Opinions

1. Valuation Perspective:

   • Post-issue P/E ratio of 36.52x aligns with industry standards (75.10x), indicating fair pricing.
   • Moderate profitability and growing revenue offer stability but limited upside potential.

2. Recommendation:

   • Onyx Biotec IPO may not be suitable for listing gains, but long-term investors in the pharmaceutical sector could consider it based on its stable financials and growth trajectory.

Conclusion

Onyx Biotec’s IPO has garnered strong interest, especially among institutional and retail investors. While the financials show moderate growth and the IPO is fairly priced, the lack of significant GMP and limited market enthusiasm suggest cautious optimism for long-term gains. Investors should evaluate the company’s financial stability and their investment horizon before making decisions.

The Upcoming IPOs in this week and coming weeks are NTPC Green, Lomosaic India, C2C Advanced System, Rajesh Power Services, Rosmerta Digital, Avanse Financial and Nisus Finance.

The Current active IPO are Zinka Logistics Solution (Black Buck), and Onyx Biotec.

For more insights into financial trends , visit our Top News Headlines. You can also explore investment opportunities in the market and apply for upcoming IPOs through our Best IPO to Apply Now section.