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Ajcon Global IPO report on Glenmark Life Sciences
Glenmark Life Sciences Limited (“GLS”) was incorporated on 23rd June, 2011. GLS is a wholly-owned subsidiary of the Promoter, Glenmark Pharmaceuticals Ltd. GLS is a leading developer and manufacturer of select high value, noncommoditized active pharmaceutical ingredients (“APIs”) in chronic therapeutic areas, including cardiovascular disease (“CVS”), central nervous system disease (“CNS”), pain management and diabetes. GLS operates two business lines – Generic APIs (generics and complex APIs) and CDMO (including specialty). Company’s API business comprises of the development, manufacture and sale of select high value, non-commoditized APIs in chronic therapeutic areas, including CVS, CNS, pain management and diabetes. The CDMO business currently comprises of applying for and procuring permission to market products in regulated markets as well as contract manufacturing of APIs for utilization by pharmaceutical companies to make formulations. GLS has strong market share in select specialized APIs such as Telmisartan (antihypertensive), Atovaquone (anti-parasitic), Perindopril (anti-hypertensive), Teneligliptin (diabetes), Zonisamide (CNS) and Adapalene (dermatology).
Valuation and Outlook
At the upper end of the price band of ₹720, the Company's IPO is valued at P/E multiple of 25x which is decent and at a good discount to peers with one of them trading over 60x and Industry average P/E multiple of 35x despite having superior return ratios. We recommend to "SUBSCRIBE" the issue due to the following factors .
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