Remus Pharmaceuticals IPO lists at 39.2% premium, gains further

Remus Pharmaceuticals IPO had a strong listing on 29th May 2023, listing at a sharp premium of 39.2%, but subsequently bounced and closed much above the listing price at the close of trading. In a sense, the strong market performance was also helped by buoyant markets. Nifty gained 100 points on the day to 18,599 and had just broken above its resistance of 18,400. These sentiments also helped the stock. For now, the headwinds like the US Fed hawkishness, fears of recession in the US and the debt ceiling are less of challenges. Amidst these headwinds, the SME IPO stock of Remus Pharmaceuticals Ltd managed to hold on for the day quite strong, even on top of a strong listing.

The stock of Remus Pharmaceuticals IPO did show a lot of strength during the day, and closed above the listing price as well as the issue price on the first day of trading on the NSE. Being an NSE SME IPO, it is only traded on the SME segment of NSE. Remus Pharmaceuticals Ltd opened 39.2% higher and the opening price turned out to be the low price for the day. With subscription of 10.75X for the QIB portion, 229.31X for the HNI / NII portion and 49.81X for the retail portion; the overall subscription was quite healthy at 57.21X. The subscription numbers were so strong that it allowed the stock to list at a huge premium and then sustain the premium post listing, despite being a relatively high priced SME IPO stock.

Remus Pharmaceuticals IPO was priced at ₹1,229 at the upper band of the book built IPO. In fact, the price band was  set in the range of ₹1,150 to ₹1,229 and got accepted at the upper end of this band. On 29th May 2023, the stock of Remus Pharmaceuticals Ltd listed on the NSE at a price of ₹1,711.25, a premium of 39.24% on the IPO issue price of ₹1,229. However, the stock bounced sharply even from these levels and it closed the day at a price of ₹1,796.80, which is 46.2% above the IPO price and 5% above the listing price of the stock on the first day of listing. In a nutshell, the stock of Remus Pharmaceuticals Ltd had closed the day exactly at the upper circuit price for the stock of 5% with only buyers and no sellers. The upper circuit price on listing day is calculated on the listing price and not on the IPO price. The opening price actually turned out to be the low price of the day.

On Day-1 of listing i.e., on 29th May 2023, Remus Pharmaceuticals Ltd touched a high of ₹1,796.80 on the NSE and a low of ₹1,711.25 per share. The opening price turned out to be the low point of the trading day while the stock closed at the highest point of the day, a typical day of strength trading on the stock counter. Incidentally, the closing price also represented the 5% upper circuit price of the stock for the day, which is the maximum that the SME IPO stock is allowed to move in the day. What is truly appreciable is that the stock closed strong amid all the global headwinds and in the endeavour it was largely supported by the Nifty which closed the day nearly 100 points higher and had showed a recent breakout above the resistance of 18,400 levels on the Nifty. The stock closed at the 5% upper circuit with 36,700 buy quantity and no sellers. For the SME IPOs, 5% is the upper limit over the listing price on the day of listing.

Let us now turn to the volumes of the stock on the NSE. On Day-1 of listing, the Remus Pharmaceuticals Ltd stock traded a total of 155,200 shares on NSE SME segment amounting to value of ₹2,684.17 lakhs on the first day.  The order book during the day showed a lot of buying with the buy orders consistently exceeding the sell orders at any point of time. That also helped the stock to close at the upper end of the circuit filter. It must be noted here that Remus Pharmaceuticals Ltd is in the trade to trade (T2T) segment so only delivery trades are possible on the stock. Hence the entire volume for the day purely represents the delivery volumes, which means than any intending trader has to put up 100% margins upfront.

At the close of Day-1 of listing, Remus Pharmaceuticals Ltd had a market capitalization of ₹264.67 crore with free-float market cap of ₹50.29 crore. It has a total of 14.73 lakh shares as the issued capital of the company. As stated earlier, since the trading is on the T2T segment, the entire volume of 155,200 lakh shares during the day is accounted for only by delivery trades.

Remus Pharmaceuticals Ltd, is an SME IPO on the NSE which had opened for subscription on 17th May 2023 and had closed for subscription on 19th May 2023. The company was incorporated in the year 2015; and the company is engaged in the marketing and distribution of finished formulations of pharmaceutical drugs. Its first major product is Active pharmaceutical ingredients (APIs); which is the biologically active component of a drug product. These are inputs that go into generic drugs. The API space had been under pressure of late, but has now recovered once again . The second category is Finished Pharmaceutical Formulations (FPFs); which are therapeutic drugs available in different dosage forms entailing higher value addition.

Remus Pharmaceuticals has a portfolio of over 429 products, with 295 products registered in a total of 13 countries and about 134 products at different stages of registration process. Remus has its presence in 20 countries and caters to generic distributors and also to regional distributors as principal clients for its products. The fresh issue portion will be used to fund its inorganic growth and working capital needs of the company. The issue will be lead managed by Beeline Capital Advisors Private Limited while Link Intime India Private Ltd will be the registrars to the SME IPO of Remus Pharmaceuticals Ltd.