On day 1, Blue Jet Healthcare IPO was subscribed 69%, where the ion of retail investors was subscribed 78%, NII share was subscribed 1.37 times, and Qualified Institutional Buyers (QIB) share was reserved 1%.
Blue Jet Healthcare IPO price band has been set in the range of ₹329 to ₹346 per equity share of a nominal value of ₹2.
Blue Jet Healthcare IPO has reserved not more than 50% of the shares in the public issue for Qualified Institutional Buyers (QIB), not less than 15% for Non-Institutional Investors (NII), and not less than 35% of the offer is reserved. for Retail Investors.
Blue Jet Healthcare IPO details
Blue Jet Healthcare IPO is an outright offer for sale (OFS) of 24,285,160 equity shares; there is no fresh theme, according to Red Herring Prospectus (RHP). Blue Jet Healthcare IPO size is ₹840.27 crores.
The promoters of the company are Shiven Akshay Arora, Akshay Bansarilal Arora, and Archana & Akshay Arora.
Shiven Akshay Arora will sell up to 5,918,849 equity shares, while Akshay Bansarilal Arora will sell up to 18,366,311 equity shares.
Also Read: Blue Jet Healthcare IPO: Check GMP, subscription status on day 2, apply or not?
The book running lead managers for the Blue Jet Healthcare IPO are Kotak Mahindra Capital Company Limited, ICICI Securities Limited, and JP Morgan India Private Limited. The registrar for the offering is Link Intime India Private Ltd.
Blue Jet IPO GMP today
Blue Jet Healthcare IPO GMP today or gray market premium was +10. On Thursday, the share price of Blue Jet Healthcare traded at a premium of ₹34 in the morning, but fell dramatically to ₹2 in the evening, and settled at ₹10.
Today’s GMP indicates that the share price of Blue Jet Healthcare was trading at a premium of ₹10 in the gray market on Friday, according to investorgain.com
Considering the upper end of the IPO price range and the current premium in the gray market, the estimated list price of the share price of Blue Jet Healthcare was indicated at ₹356 a piece, which is 2.89% higher than the IPO price of ₹346.
“Grey market premium” indicates the willingness of investors to pay more than the issue price.
Blue Jet IPO Review
“We like Blue Jet for its complex product portfolio, presence in niche space, strong customer relationship and high entry barriers. The IPO is valued at 34x Q1FY24 P/E on an annualized basis. We believe the company could benefit from the planned capacity expansion and sector tailwinds. That’s why we recommend to Subscribe to the IPO,” the brokerage said in the report.
Reliance Securities
The brokerage claims that Blue Jet Healthcare is one of the leading companies in specialized markets, with more than 20 years of experience, specific chemical capabilities and specialized R&D laboratories to provide a range of products in highly concentrated contrast media formulations. Going forward, management is implementing a prudent revenue diversification strategy, with a focus on exports and a high-margin product mix.
“The increased expansion over the next 2 years for an anticipated increase in demand and leveraging the customer relationships for pharmaceutical intermediates and API categories will increase earnings over the next few years. We recommend SUBSCRIBE to the issue,” the broker said.
Also Read: Blue Jet Healthcare IPO: GMP, subscription status, review, other details. To apply or not?
Nirmal Bang
Blue Jet Healthcare has a solid track record of overall performance, according to the brokerage’s analysis. Top line growth was robust, growing at 10% CAGR between FY20 and FY23 and 24% y-o-y in Q1FY24. With the exception of FY23, when it recorded an EBITDA margin of 30.4% due to an increase in raw material prices and labor costs, it has consistently produced high operating margins of over 35%.
On the other hand, Q1FY24 saw an improvement due to slowdown in the price of raw materials and other costs. We cannot compare Blue Jet Healthcare with exact peers because there are no identified businesses that operate in a similar capacity to it, the brokerage explained.
Also Read: Blue Jet Healthcare IPO: 10 key risks investors should know before subscribing to the issue
“However, we have made a peer comparison with the set of companies having strong financials in pharmaceutical industry. Company’s ROE and ROCE for FY23 stood at 23.5% and 32.0% are slightly better compared to the average rate of return of peers of 23.3% and 30.2 %, respectively. The issue is valued at a PE valuation of 33.9x based on Q1FY24 annualized EPS, which seems reasonable compared to an average valuation of selected peers of 34.3x. Thus, we recommend SUBSCRIBE to the issue,” the broker said.
Choice Equity Broking
The brokerage claims that Blue Jet Healthcare is primarily a Contract Development and Manufacturing Organization (CDMO), accounting for about 75% of its total revenue. It has a specialized product line and has built lasting relationships with its customers throughout its business. Because of this, it can now generate almost 70% of its total revenue from long-term contracts with these types of customers.
Also Read: Blue Jet Healthcare IPO: Blue Jet IPO raises the bar ₹252.08 crore from anchor investors; details here
The company claimed significant business growth in FY20-23, but rising raw material costs had a negative impact on profitability. Despite a three-fold increase in net wealth, RoE was strong. In the future, Blue Jet Healthcare will benefit from lower/stabilizing raw material prices as well as continued demand for its products. It has planned a number of brownfield and new construction projects, raising installed capacity by around 50% over FY25E.
Also Read: Blue Jet Healthcare IPO: Five customers drive 76% of company’s revenue
“There is no comparable peer having product and business operations similar to Blue Jet Healthcare. The above peers are considered only to benchmark the required valuation. At a higher price bracket, Blue Jet Healthcare requires a TTM P/E multiple of 34x (to its TTM EPS of Rs. 10.2), which is a discount to the adjusted peer average. Thus considering the above observations, we assign ‘SUBSCRIBE’ rating to the issue,” the brokerage said.
Disclaimer: The above views and recommendations are those of individual analysts, experts and trading companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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