Global specialty pharmaceutical company, Blue Jet Healthcare, has witnessed a robust investor response to its IPO. The company, which started as a saccharin and salts producer, is offering shares priced between Rs 329-346 each in an Offer for Sale (OFS), aiming to raise up to Rs 840.27 crore. By the second day of the IPO, 96% of the offered equity shares had been bid for, signaling a successful subscription.
The IPO garnered substantial interest from non-institutional and retail investors who subscribed 1.97 and 1.08 times respectively. However, qualified institutional bidders showed a relatively lukewarm response with only a 0.01% subscription rate.
Blue Jet has broadened its product portfolio by venturing into contrast media intermediates for CT scans and MRIs and has plans for greenfield expansion. Brokerage firms have shown optimism about the IPO due to Blue Jet's promising growth prospects, unique business model, solid financials, and debt-free status. Other factors contributing to the positive outlook include high entry barriers in the industry, a complex product portfolio, and Blue Jet's standing as a specialty pharmaceutical company.
Despite a P/E of 34 times at Rs 346, which is considered fully priced, brokerage firms have assigned a 'subscribe' rating on a medium- to long-term basis. The IPO is managed by ICICI Securities, JP Morgan India, and Kotak Mahindra Capital Company with Link Intime India serving as the registrar.
Prior to the IPO, Blue Jet raised Rs 252.08 crore from 22 anchor investors by allocating shares at Rs 346 each. The company's multi-year contracts with multinational clients facilitate the management of long-term supply contracts and logistics for their customers.
The planned capacity expansion could potentially benefit the company from sector tailwinds. Mehta Equities views the IPO as an opportunity to invest in a company with niche products and anticipates decent listing gains due to Blue Jet's first-mover advantage and strong financial position.
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