Injecting cash

The promoter-controlled Abellon Energy has sold a major chunk of its holding for ₹97 crore in Claris Lifesciences run by Arjun Handa. Post the transaction, Abellon’s stake is down to 2.43% from 10.86% and overall promoter holding is still at 52%. Of the 46 lakh shares that were off-loaded, about 24 lakh was bought by East Bridge Capital Master Fund and close to 8 lakh by Morgan Stanley Singapore.

FII interest in the counter has seen an uptick over the past quarters. From 12.95% in the September 2015, it is now at 20.29%. The new investors include Switzerland-based HBM Healthcare Investments and another entity strangely named Cobra India. Domestic mutual funds are yet to inject themselves as of the 21.64% institutional stake, the rest is held by a single Indian fund house. Reliance AMC which now holds 1.35% made its entry in October, 2015, when it picked up a 1.14% stake for about ₹12 crore.  

Where there are FIIs, there is a story and there is one here too. Claris’ product portfolio and global presence gives it an edge in the high-entry barrier sterile injectables space. It has 400 product registrations globally across a number of therapeutic segments like anaesthesia, critical care, renal (kidney-related) care, among others. It also has an established sales front end in regulated markets like the US and EU. 

The current optimism is around the ANDAs the company has lined up. It has received approvals for 14 ANDAs till-date and has about 24 more pending. The booster according to analysts is that FY17 is also likely to see the launch of Propofol in the US. The drug, which is used to maintain or induce anesthesia during surgeries, will give Claris access to a $350 million market with limited competition. For FY17, the management has forecast a 24% revenue growth and a 330 basis points improvement in operating margin without counting in any new US launches. In FY16, the company notched up an Ebitda margin of 19.3% while hitting a topline of ₹740 crore.