Blue Jet Healthcare's IPO Subscription Opens: Grey Market Premiums Indicate Investor Enthusiasm

The Maharashtra-based pharmaceutical firm Blue Jet Healthcare is all set to embark on its IPO journey as it opens for subscription on October 25, with the subscription window concluding on October 27. Investors are closely watching the proceedings, and the grey market premiums (GMP) have already painted a promising picture.

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The Maharashtra-based pharmaceutical firm Blue Jet Healthcare is all set to embark on its IPO journey as it opens for subscription on October 25, with the subscription window concluding on October 27. Investors are closely watching the proceedings, and the grey market premiums (GMP) have already painted a promising picture.

Before the IPO launch, Blue Jet Healthcare's shares were commanding a substantial premium of Rs 63 in the unlisted market. This surge in grey market premiums serves as a preliminary indicator of the company's potential success. However, it's vital to remember that these indicators can fluctuate rapidly.

The company has set a price band for its IPO, ranging from ₹329 to ₹346 per share. With this offering, Blue Jet Healthcare aims to amass an impressive ₹840 crore, should it reach the upper end of the price range. Potential investors can bid for a minimum of 43 equity shares and increase their stake in multiples thereof.

As a testament to its appeal, Blue Jet Healthcare already raised ₹252.08 crore by allocating 72,85,548 equity shares to 22 anchor investors at a price of ₹346 per equity share on October 23. The anchor investors include both global and domestic giants like ICICI Prudential Mutual Fund, HDFC Mutual Fund, and BNP Paribas Arbitrage, among others.

It's crucial to note that the IPO comprises solely an offer-for-sale (OFS) portion, with no fresh issue component. Promoters Akshay Bansarilal Arora and Shiven Akshay Arora will divest 2.42 crore equity shares, with all OFS proceeds going to the selling shareholders rather than the company itself.

In terms of allocation, 50% of the public offer is reserved for qualified institutional buyers, 35% for retail investors, and the remaining 15% for non-institutional investors. Leading the IPO are Kotak Investment Banking, ICICI Securities, and JP Morgan, with Link Intime India acting as the registrar.

Following the IPO, Blue Jet Healthcare's equity shares will be listed on both BSE and NSE, extending its reach to a broader investor base.

A snapshot of Blue Jet Healthcare's financial performance reveals a 24% year-on-year surge in total income to ₹185 crore for the three months ending in June. Meanwhile, net profits witnessed a remarkable 59% increase, reaching ₹44.1 crore.

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In the previous financial year (2021-2022), the company generated 76% of its income from Europe, followed by India (17.14%), the US (4.18%), and other regions. Blue Jet Healthcare specializes in pharmaceutical and healthcare ingredients, targeting innovator and generic pharmaceutical companies. Their unique business model focuses on collaboration, development, and manufacturing within complex chemistry categories.

Operating under a contract development and manufacturing organization (CDMO) model, the company's business spans three product categories: contrast media intermediates, high-intensity sweeteners, pharma intermediates, and active pharmaceutical ingredients (APIs). With these specialties, Blue Jet Healthcare aims to carve a niche in the pharmaceutical industry and provide investors with an exciting opportunity for growth.