Biocon IPO to debut on March 11

Friday, 27 February 2004, 08:00 Hrs
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BANGALORE: India's biotechnology major Biocon Ltd. Thursday announced it would open its initial public offering (IPO) of 10 million equity shares in the primary market on March 11.

The Bangalore-based firm has opted for the 100 percent book-building process for the public issue for efficient price discovery. The issue will close a week later on March 18.

Constituting 10 percent of the fully diluted post issue paid-up capital of the company, Biocon's shares, of 5 each in a price band of 270-315 per share, will be listed on the Bombay Stock Exchange and the National Stock Exchange in the first week of April for trading in the secondary market.

The company's post-issue paid-up capital will be 1 billion.

Explaining the salient features of the IPO, the first of its kind in India's biotech sector, Biocon chairman and managing director Kiran Mazumdar Shaw told reporters here that the company would be holding road shows during the next fortnight in India and abroad.

The road shows will be held in Mumbai and Ahmedabad next week and in London on March 2-3, in Hong Kong on March 8-9 and in Singapore on March 10-11, 2004.

"We look forward to widespread participation in our first IPO, giving us a chance to widen our investor base. We intend to utilize the proceeds to enhance our fermentation and chemical synthesis capacity and skills to meet the growing demand for biopharmaceutical products such as statins," Shaw declared.

As per the Securities and Exchange Board of India (Sebi) guidelines, of the 10-million shares, 6 million (60 percent) shares will be offered to qualified institutional bidders, 2.5 million (25 percent) shares to retail investors and the balance 1.5 million (15 percent) shares to non-institutional bidders.

In case of over-subscription, the allotment to retail and non-institutional investors will be on proportionate basis up to a minimum of 50 equity shares, while it will be discretionary for institutional bidders.

According to the company's unconsolidated financial statements, the earnings per share (EPS) has been adjusted to 25.5 for the nine-month period ending December 31, 2003 for pre-split and 12.8 for post-split, with a weighted average of 14.1 and 7 respectively.

Similarly, the price/earning (P/E) ratio has been based on the firm's nine-month performance at 12.8 (post-split, annualized). The average return on net worth has been computed on an annualized basis at 53.9, with a weighted average of 37.5.

The 25-year-old company has reported an income of 3.73 billion for the nine-month period of the current fiscal year (2003-04) against a total income of 2.56 billion for the preceding fiscal 2002-03.

The net profit for the nine-month period is 870 million as against 360 million for fiscal 2002-03.

Source: IANS
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