To add capacity at Kheda facility.
Ahmedabad-based manufacturer of sterile dosages Marck Biosciences is all set to go for a public issue soon. The company is looking at raising around Rs 55 crore to partly fund its expansion plans.
Marck will issue 1.3 crore equity shares of face value Rs 10 each by the book building process. Out of this, 30 lakh shares are as offer for sale by IFCI Venture, and the funds raised through the balance one crore equity shares would be utilised for the establishment of a sterile liquid manufacturing plant for large volume parenteral line adjacent to the existing factory premises at Kheda near Ahmedabad. The additional facility is planned taking into account the future demand and the fact that Marck Biosciences is operating above 90 per cent capacity for the last three years.
According to market sources, private equity player IFCI Venture Capital is looking at making a partial exit. IFCI had invested around Rs 17.5 crore in Marck Biosciences in 2008 and currently holds around 15 per cent equity in the company which would be diluted to around 5 per cent post issue. Similarly, the promoters' shareholding in Marck would also come down from over 60 per cent to around 52 per cent and public holding would be around 25 per cent.
Marck hopes to raise around Rs 55 crore from the IPO for which it has already filed a Draft Red Herring Prospectus(DRHP) to Sebi earlier this month. Bhavesh Patel, managing director of Marck Biosciences, refused to comment on the issue. With the expansion, Marck Bioscience's production capacity would rise from 596 lakh bottles per annum to 1058 lakh bottles per annum. The facility is intended to be built according to WHO-cGMP specifications.
Earlier this year, Marck Biosciences Ltd had developed Paracetamol IV in plastic pack. It plans to launch it in India within the end of this year and is looking at generating business worth Rs 2 crore from the new product. The company has developed Paracetamol IV in plastic pack using blow-fill-seals(BFS) technology with an investment of around Rs 30 lakh. It currently manufactures the product at its Kheda facility and has started exporting it to countries in West Africa since July.
Marck manufactures and markets a range of sterile dosages spanning fluid therapy, ophthalmics, respiratory, irrigation solutions and anti-infectives across India and also contract manufactures sterile dosage pharma products for leading pharma companies in India. The company also operates in the non-therapeutic space including products like medical devices such as, lens cleaning solutions, eye & wound irrigation, eyewash solution and first aid solution. It reported a turnover of Rs 88 crore in 2009-10, with a profit after tax of Rs 2.7 crore.