Bafna will be the second pharmaceutical company from south India to tap the capital markets this month. The Rs 75-80 crore IPO of Hyderabad-based Anu's Laboratories closed this week.
The Bafna Pharmaceuticals IPO is to part-fund a new manufacturing facility for entering contract manufacturing business and for expanding the marketing set-up, said Mahaveer Bafna, the chairman and managing director of the company.
The company will soon start commercial production of tablets and capsules at the Rs 32-crore, export-oriented unit in Grandyon, Chennai. The facility is built according to global standards and is awaiting the UK Medicines and Healthcare Products Regulatory Agency (MHRA) approval.
The Rs 40-crore company plans to position the new facility for contract manufacturing for multinational companies. At present, Bafna has a manufacturing facility in Madhavaram, Chennai, and markets over 120 products in the anti-infective, cardio-vascular, diabetes and pain management segments. The research and development division also has a pipeline of another 14 new products.
Bafna also exports its products to the unregulated markets, mainly Sri Lanka, and half of the turnover are from exports, said Mahaveer Bafna. The money raised from the IPO will be utlised to launch own branded formulations in the domestic market.
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Another Rs 4-5 crore will be slotted for registering the products in various markets and for accreditation of the plant from the Medicines and Healthcare Products Regulatory Agency (MHRA) of the UK.
Another Rs 3 crore will be deployed to ramp up the in-house research and development centre, while the remaining amount has been set aside for repaying loans taken for constructing the Rs 32-crore plant.