Mankind pharma share price opens 4.6% higher as is set to buy 100% stake in Bharat Serum and Vaccines

Stock Market Today: Mankind Pharma share price opened 4.6% higher post to its announcements pertaining to acquisition of stakes in Bharat Serums and Vaccines Limited.

Mankind Pharma share price opened 4.6% higher at ₹2240.00 over the previous close on the BSE on Friday. However gave away most of the gains thereafter.

Mankind Pharma announced having entered into a definitive agreement to acquire a 100% stake in Bharat Serums and Vaccines Limited (BSV) from Advent International (“Advent”), one of the key private equity investors.

Deal valuation

Mankind Pharma said that it will be buying 100% stake in Bharat Serums and Vaccines Limited for an enterprise value of approximately ₹13,630 Crores. This translates into a a valuations of 23-24 times enterprise Value by Ebitda (EV/Ebitda) a per company presentation. Ebitda stands for Earnings before interest tax depreciation and amortisation. The transaction is to be funded through internal accruals and a mix of debt and equity. The transaction that is set to be closed in 3-4 months.

Benefits:

Mankind Pharma said that the acquisition of Bharat Serums and Vaccines will expand its presence in high entry barrier portfolio and help it maintain leadership in Women’s Health. The first ranked in Gynecology segment in the Indian Pharma Market.

Bharat Serums and Vaccines portfolio

Bharat Serums and Vaccines domestic Brand portfolio comprises of large brands. Its one brand is valued at more than ₹100 Crore, 3 Brands valued at ₹50-100 crores, 8 brands are valued at ₹25-50 crore.

Bharat Serums and Vaccines reported margins stood at 23%, in FY24. nevertheless adjusted for one -offs stood at 28% in FY24 as per Mankind's investor presentation.

Bharat Serun And Vaccines revenues during FY24 stood at ₹1,723 crore. While domestic markets contributed 54% to the sales, Branded international sales stood at 46%.

Mankind Financials-

Mankind FY24 sales stood at ₹10,335 crore, with Ebitda at ₹2,550 crore translating into Ebitda margins of 24.7%. The acquisition of Bharat Serum And Vaccines will mean expansion of Mankind brand portfolio, that will now now contain more than 40 brands valued valued at more than ₹50 crore.

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value of approx. INR 13,630 Crores, subject to closing related adjustments