Mankind Pharma Set to Explore Fundraising Options on 24 Sept

On September 18, Mankind Pharma announced that its board will convene next week to discuss a proposal for raising funds through the issuance of securities. The meeting is set for September 24, when the board will review and approve fundraising via non-convertible debentures (NCDs), commercial papers, or other debt instruments, either individually or in combination, as per a regulatory filing.

According to a filing dated September 17, "The Board of Directors will meet on September 20, 2024, to consider and approve the raising of funds through the issuance of non-convertible debentures, commercial papers, other debt securities, or any combination thereof, for an amount to be determined by the Board." However, the exact sum the company aims to raise was not disclosed.

In a recent presentation to investors, Mankind outlined its strategic focus on expanding its consumer healthcare business. The company plans to achieve this through product line extensions, new launches, and the premiumization of existing offerings. It also intends to leverage its strong brand presence and explore new distribution channels to fuel growth.

The company is also looking to enhance its prescription value in current markets and broaden its footprint in the chronic segment by deepening its presence in existing therapies, according to the presentation.

Earlier this month, Mankind raised over ₹9,000 crore through a combination of NCDs and short-term commercial papers. This capital was intended to fund the ₹13,630 crore acquisition of Bharat Serums and Vaccines Ltd (BSV), a deal first announced in July, as reported by The Economic Times.

The acquisition from Advent International represents Mankind's largest deal since its market debut a year ago. Upon completion, it is expected to propel Mankind into a leadership position in the fast-growing gynecology-fertility segment, where it is projected to hold a 20% market share, surpassing Emcure. As of FY24, Mankind held an 8.19% share in this sector. The acquisition will be financed using a mix of internal accruals, debt, and equity.

By the end of FY24, Mankind reported a total debt of ₹9 crore and held a net cash position of ₹3,747 crore as of June. With a market capitalization of ₹95,846 crore, its stock has risen 34% over the past year, outperforming the Nifty index’s 31% gain during the same period.

Ahead of this acquisition, Crisil rated Mankind’s NCDs as AA+/stable, citing its robust market position, operational efficiency, and sound financial risk profile. Crisil expects the company to maintain its stable business risk profile, supported by a broad therapeutic portfolio and strong standing in the domestic market. Operating profitability is expected to remain within the 25-26% range.

Rajeev Juneja, Mankind Pharma’s managing director, recently mentioned that the company plans to repay the debt incurred from the BSV acquisition within three years.

Mankind Pharma Limited is an Indian pharmaceutical company involved in developing, manufacturing, and marketing a broad range of formulations across both acute and chronic therapeutic areas. Beyond pharmaceuticals, the company also produces consumer healthcare products. Its portfolio includes treatments for various medical conditions such as infections, cardiovascular diseases, gastrointestinal issues, diabetes, neurological disorders, and respiratory conditions, among others.

The company operates several subsidiaries, including Lifestar Pharma Private Limited, Magnet Labs Private Limited, and Jaspack Industries Private Limited.