Mankind Pharma Ltd. share price target

Mankind Pharma (Mankind) delivered in-line revenue in 4QFY25; however, EBITDA/PAT came in 14%/12% below our estimates. Higher-than-expected spending on marketing and promotional activities affected the company’s 4Q performance.

Mankind Pharma (Mankind) delivered in-line operational performance for 3QFY25. The earnings were below estimates due to higher interest outgo on debt raised to fund the BSV acquisition.

Mankind Pharma (MANKIND) delivered better-than-expected 2QFY25 performance, fueled by a strong revival in growth of the consumer business and continued growth momentum in the exports business.

MANKIND has a strategic roadmap for growth through expansion in high entry barrier innovative product launches in the chronic/consumer segment and other adjacencies, transitioning from sexual wellness to consumer wellness in the over-the counter (OTC) space.

Mankind Pharma has agreed to acquire Bharat Serum Vaccines (BSV) for EV of INR136b, implying EV/EBITDA of 28x/22-23x on FY24/FY25 basis.

In a span of 30 years, Mankind Pharma (MANKIND) has built a robust domestic
formulation (DF) franchise and become the fourth largest player by market share.

Incorporated in 1991, Mankind Pharma Limited is a pharmaceutical company which is engaged in developing, manufacturing and marketing a diverse range of pharmaceutical formulations across various acute and chronic therapeutic areas, as well as several consumer healthcare products.

Considering the TTM (Dec-22) /FY23 Annualized EPS of Rs 29.61/33.16 on a post-issue basis, the company is going to list at a P/E of 36.47/32.57x with a market cap of Rs. 4,32,636 mn. whereas its peers namely Sun Pharmaceuticals, Cipla, Alkem Lab and Torrent Pharmaceutical are trading at a P/E of 29.43x, 27.45x, 39.24x, 43.65x.

IPO NOTE

Mankind is the fourth largest player in the domestic market with a presence across therapy areas like anti-infectives, cardiac, gastro, respiratory and also in consumer healthcare segments like condoms, acne preparations, emergency contraceptives, pregnancy tests among others.

Mankind Pharma Ltd. (“Mankind”) is India’s 4th largest pharmaceutical company in terms of Domestic sales and 3 rd largest in terms of sales volume for MAT (Moving An nual Total) December 2022 engaged in diverse range of pharmaceutical formulation across acute and chronic therapeutic areas.

Mankind benefits from the industry experience and business acumen of their individual Promoters and is driven by the 3 core values of quality, affordability and accessibility. Their professional and experienced management team has been critical in building their brands, growing their operations, and maintaining capital efficiency despite their emphasis on affordable product offerings.

MPL focuses primarily on the domestic market (98% of sales) with market share increasing from 4.1% to 4.3% over FY20 - MAT Dec’22 with sales growing at 12% CAGR v/s IPM (Indian Pharmaceutical Market) growth of around 10% for the same period.

Mankind Pharma Ltd (MPL) is the fourth largest pharmaceutical company in India by domestic sales and third largest by sales volume. With 97% of its revenue from India, MPL sells pharmaceutical formulations and consumer healthcare goods, and operates 25 manufacturing sites and a specialised R&D centre with four divisions.

Issue Snapshot: Issue Open: Apr 25 Apr 27, 2023 Price Band: Rs. 1026 1080 *Issue Size: 4326.36 cr (Entirely Offer for Sale of 40,058,844 eq sh) Reservation for: QIB upto 50% eq sh Non-Institutional atleast 15% eq sh ((including 1/3rd for applications between Rs.2 lakhs to Rs.10 lakhs)) Retail atleast 35% eq sh Face Value: Rs 1 Book value: Rs 178.38 (December 31, 2022) Bid size: - 13 equity shares and in multiples thereof 100% Book built Issue IPO Note - Mankind Pharma Limited