KARACHI: Citi Pharma IPO's book building phase will be held on June 15 and 16, 2021 where high net worth individuals and institutional investors will subscribe to 75 percent of the issue size (54.5 million shares).

The book building will start at the floor price of Rs 28 per share, including premium of Rs 18 per share. Based on the interest from investors during the book building process, the strike price can rise by 40 per cent (Rs 39.20 a share), thus helping the company collect Rs 2.8 billion.

After the book building process, successful bidders will be provisionally allotted 75 percent of the issue size (54.5 million shares). The remaining 25 percent (18.1 million shares) will then be offered to retail investors at the strike price. Citi Pharma aims to raise up to Rs 2.8 billion by offering a 35 percent stake to institutional and ordinary investors.

Citi Pharma is one of the largest active pharmaceutical ingredients (API) manufacturers in Pakistan and also makes formulations products. In particular, Citi Pharma sells paracetamol, an API used in painkillers, to GlaxoSmithKline that mixes it with other chemical salts and sells under the renowned brand of Panadol.

Citi Pharma is raising new funds primarily to expand its existing capacity of 3,600 tonnes per annum of paracetamol to 6,000 tonnes per annum. The demand for paracetamol has surged in the wake of Covid-19. In addition, company plans to add new APIs as well as pharmaceutical formulations (final products) to its existing product line.

Copyright Business Recorder, 2021