Should You Consider Investing in Onyx Biotec IPO?

Onyx Biotec Limited, a leading player in India’s pharmaceutical manufacturing industry, is presenting an Initial Public Offering (IPO) valued at ₹29.34 crores. Onyx Biotec's IPO comprises a fresh issue of 48.1 lakh shares, providing investors with an opportunity to invest in a fast-growing sector. Established in 2005, Onyx Biotec primarily produces Sterile Water for Injections and provides contract manufacturing for Dry Powder Injections and Dry Syrups, serving both domestic and international markets. With two manufacturing units located in Solan, Himachal Pradesh, the company aims to utilize the IPO proceeds to expand its manufacturing capabilities, enhance its service offerings, and strengthen its position in the industry. Onyx Biotec IPO, managed by Horizon Management Private Limited, is a strategic move to bolster Onyx’s financial base and support its growth trajectory, aligning with India’s expanding pharmaceutical sector.

Why Should You Consider Investing in Onyx Biotec IPO?

• Investing in the Onyx Biotec IPO could be a strategic decision, given the company's expanding product line, established clientele, and strong financial growth. Here are several compelling reasons:
• Comprehensive Product Portfolio: Onyx Biotec provides a range of essential pharmaceutical products, including sterile water for injections and dry powder medications, catering to both Indian and international markets.
• Expanding Client Network: With over 100 clients, including notable pharmaceutical brands such as Mankind Pharma and Sun Pharmaceutical Industries, Onyx Biotec has built a strong client network.
• Strategic Manufacturing Scale and Upgradation Plans: The company operates two manufacturing units in Solan, Himachal Pradesh, with significant daily production capacities. IPO funds will assist in expanding capabilities to manufacture larger volumes and add a high-speed packaging line. 
• Robust Financial Performance: Onyx Biotec has demonstrated impressive financial growth, with revenue increasing by 35.99% and profit after tax (PAT) rising by 64.35% between FY23 and FY24.

Invest in Indian Markets and Unlock Future Potential With 5paisa!

Open Account Now

Onyx Biotec IPO Key IPO Details

• IPO Open Date: November 13, 2024
• IPO Close Date: November 18, 2024
• Price Band: ₹58 to ₹61 per share
• Minimum Investment: ₹122,000 (2000 shares)
• Total Issue Size: ₹29.34 crores
• Fresh Issue: ₹29.34 crores (48.1 lakh shares)
• Listing Date: November 21, 2024 (Tentative)
• Listing At: NSE SME

Onyx Biotec Ltd. Financials

Onyx Biotec's financials indicate steady revenue and profit growth, underscoring its robust operational capabilities and financial health. Below is an overview of key financial (restated) metrics from recent years:

Onyx Biotec’s performance shows an upward trajectory in revenue and assets, demonstrating the company's operational scale and efficient management.

Onyx Biotec Market Position and Growth Prospects

Onyx Biotec occupies a significant position within India’s pharmaceutical manufacturing sector, serving a broad client base across 22 states and several countries. With the increasing demand for healthcare solutions, Onyx Biotec’s expansion into digital and large-scale manufacturing positions it strategically to capitalize on these evolving market trends. As government initiatives continue to drive growth in the pharmaceutical industry, Onyx Biotec’s robust service portfolio, extensive market reach, and focus on operational efficiency provide a strong foundation for sustainable growth.

Onyx Biotec Competitive Strengths and Advantages 

• Established Product Portfolio: With specialised products like sterile injections and dry powders, Onyx Biotec addresses crucial healthcare needs.
• Technological Edge in Manufacturing: Equipped with high-capacity manufacturing units, the company maintains strict quality and operational efficiency.
• Resilient Client Network: Long-standing relationships with top-tier pharma companies enhance Onyx Biotec’s market credibility and customer retention.

Onyx Biotec IPO Risks and Challenges

Like any investment, the Onyx Biotec IPO comes with associated risks:

• Regulatory and Compliance Risks: The pharmaceutical industry is subject to stringent regulatory standards. Any changes in regulations could impact operations, resulting in increased expenses or changes in revenue.
• Capital-Intensive Expansion: With expansion plans relying on substantial capital, the company may face financial pressures if market conditions shift unexpectedly.
• Competitive Market Environment: India’s pharmaceutical sector is highly competitive, with numerous players. This competitive pressure could affect Onyx Biotec’s market share and profit margins.

Conclusion – Should You Invest in Onyx Biotec IPO?

The Onyx Biotec IPO presents a compelling investment opportunity in a sector experiencing rapid growth. The company’s technological advancements, broad product portfolio, and strategic expansion plans provide a solid foundation for future growth. Despite regulatory and competitive challenges, Onyx Biotec’s strong financial performance and industry positioning offer promising potential for long-term returns. Investors should evaluate their financial goals and risk appetite before participating in this IPO.

Note: This article is for informational purposes only and does not constitute investment advice. Investors should assess their financial goals and risk appetite before making any investment decisions.