Lahore Based Pharma to Go Public Soon

Citi Pharma Ltd., a raw material supplier to the Pakistani units of GlaxoSmithKline Plc and Abbott Laboratories, is set to be listed at Pakistan Stock Exchange (PSX) in the coming months through Initial Public Offering (IPO).

According to PSX, the local pharmaceutical company applied for its listing with the bourse.

The pharmaceutical is one of the active sectors at PSX with various renowned names, including Searl, GSK, AGP, Feroz, Abbott, etc. Citi Pharma will be the 12th public listed pharmaceutical company.

Citi Pharma is renowned in Pakistan for being the leading Active Pharmaceutical Ingredients (API) producer. Its principal business activity is the manufacturing and sale of pharmaceuticals, medical chemicals, and botanical products, mainly to pharmaceutical companies.

The current capacity per annum is 3,600 tons for Paracetamol, 600 tons for Amoxicillin, 300 tons for Ciprofloxacin, and 168 tons for Cefixime. Ample free land on the current premises is available for capacity enhancement and addition of new chemicals to the existing product line.

The pharmaceutical market in Pakistan was worth approximately Rs. 501 billion in 2020, according to an estimate. In 2020, the industry witnessed a growth of 10.05 percent and posted a 4-year CAGR of 11.48 percent (2016-2020).

At present, Pakistan produces a variety of medicines and meets more than 70 percent of the demand for domestic pharmaceutical products. The pharmaceutical industry in Pakistan is highly competitive given that approximately 80 percent of the market share is held by the top 50 companies in terms of revenue.

As of April, there are more than 650 manufacturing units and above 9,000 actively marketed drugs. The division of market share between local pharmaceutical companies and MNCs is roughly 31:69, respectively.

About The IPO

This Issue consists of 72.69 million (72,692,000) Ordinary Shares (35% of the total post-IPO paid-up capital of CPL) of the face value of Rs. 10/- each.

The entire Issue will be offered through Book Building at a Floor Price of  Rs. 28/- per share (including premium of PKR 18/- per share) with a maximum price band of up to 40 percent. The bidders shall be allowed to place bids for a hundred percent (100%) of the Issue size, and the Strike Price shall be the price at which the hundred percent (100%) of the Issue is subscribed.

However, the successful bidders shall be provisionally allotted only seventy-five percent (75%) of the Issue size, i.e., 54,519,000 shares, and the remaining twenty-five percent (25%), i.e.18,173,000 shares shall be offered to the retail investors. In case the retail portion of the Issue remains unsubscribed, the unsubscribed shares will be allotted to the successful bidders on a pro-rata basis.

The bidders shall be allowed to place bids for a hundred percent (100%) of the Issue size, and the Strike Price shall be the price at which the hundred percent (100%) of the Issue is subscribed. However, the successful bidders shall be provisionally allotted only seventy-five percent (75%) of the Issue size, i.e. 54,519,000 shares, and the remaining twenty-five percent (25%), i.e. 18,173,000 shares shall be offered to the retail investors.

In case the retail portion of the Issue remains unsubscribed, the unsubscribed shares will be allotted to the successful bidders on a pro-rata basis.



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