With 20 years of experience in the pharmaceutical industry, Goldline Pharmaceutical is finally launching its BSE SME IPO. The firm began in Nagpur, intending to grow slowly and provide high-quality pharmaceutical products for everyone, while focusing on customer satisfaction.
As an investor, it can be very challenging to decide whether the Goldline Pharmaceutical IPO is a good or bad investment. Not anymore, as in this blog, we will provide you with all the necessary details related to the Goldline Pharmaceutical IPO to help you decide whether you should Apply or Not. Read on to know the IPO risks, strengths, valuation, financial details, and expert opinion to make your investment decision better.
Goldline Pharmaceutical IPO ReviewĀ
| Reviewer | Recommendation |
| IPO Watch | May Apply |
| Beacon Capital Advisors Pvt. Ltd. (Equivision) | May Apply |
Strengths:
- The firm is backed by experienced promoters and a management team with over 50 years of experience in the pharma industry.
- The company provides a wide range of pharmaceutical products under its various sub-brands, including Goldline Pharma, Goldline Cardinal, Goldline Aayushman, Goldline InLife, and Goldline Wellness.Ā
- Goldline has established a strong relationship with its supplier and vendor for long-term support of raw materials.
- Its Scalable asset-light business model supports efficient growth, market expansion, and strong customer-focused operations.
Weaknesses:Ā
- The firm does not manufacture its own products, infact it depends on 3rd party manufacturer for its pharmaceutical products. If those manufacturers fail to meet the quality, regulatory, or on-time delivery requirements can negatively impact the business.
- The company has ongoing litigations of ā¹271.23 lakhs in Direct Tax matters and ā¹63.70 lakhs in indirect tax matters.Ā
- About 44% of the companyās revenue comes from the state of Maharashtra, which exposes them to a limited geography with a limited number of customers. Losing any of them can adversely affect the business.
- Goldline Pharmaceutical’s business mainly depends on the performance of the marketing team. If the team failed to market the products properly can adversely affect the business performance and financial condition.Ā
Promoters & Track Records, if anyĀ
- Amol Laxmikant Mujumdar, aged 54 years, is the Promoter, Chairman, and Managing Director of the Company. He holds 27,49,988 of Equity shares, representing 39.85% of Pre-Offer equity capital.
- Swapan Premprakash Khandelwal, aged 57 years, is the Promoter and Whole-Time Director of the Company. He holds 27,49,988 of Equity shares, representing 39.85% of pre-Offer equity capital.
Peer Comparison with the Company
| Name of the Company | Face Value(ā¹) | Basic EPS (ā¹) | Diluted EPS(ā¹) | RONW (%) | P/E Ratio | NAV(ā¹) |
| Goldline Pharmaceutical Service | 10 | 4.10 | 4.10 | 27.37% | 10.48x | 12.38 |
| Mono Pharmacare Limited | 10 | 1.75 | 1.75 | 9.90% | 7.57x | 17.66 |
| Chandra Bhagat Pharma Limited | 10 | 1.14 | 1.14 | 2.86% | 28.94x | 39.72 |
Industry Peer Group P/E ratioĀ
The industry P/E ranges from a low of 7.57 times to a high of 28.94 times, with an average P/E of 18.26 times.
ExpansionĀ
- The proceeds of ā¹8.90 crore will be used towards repayment/prepayment of existing borrowings taken by the company.
- While the remaining funds will be utilized towards general corporate purposes.
Goldline Pharmaceutical IPO ā Should You Apply or Not?
Amol Laxmikant Mujumdar started the pharma company as a rookie with nothing but a dream of becoming and achieving something, and thatās how Goldline Pharmaceutical Limited started.Ā
A Pharma company that offers a diverse range of tablets and capsules under various specialties. Looking at its financials, its revenue and PAT have been growing with a CAGR of 19ā20% between FY23 and FY25. While a higher margin business is good, it raises questions for investors about its sustainability over the long-term. Also, the company does not manufacture its own products, which is a bit of a concerning point to look after.
As of May 9, the Goldline Pharmaceutical IPO GMP is ā¹8, indicating a listing gain of around 18.60%. Moreover, at the upper price band of ā¹43, the company is valued at a P/E of 10.48x. When compared to industry P/E, the IPO seems to be priced fairly and attractively.Ā
Lastly, this issue allocated 50% of shares to QIB, 35% to retail, and 15% to NII, which is a bit surprising as this is an SME IPO and it usually allocates more big shares to retail investors. All we have to do is wait and see how this changed pattern of allocation affects the interests of investors. Will this be only one time, or every SME IPO will follow this pattern?
My Verdict: Investors with industry knowledge who want to take risks can invest in this IPO for the medium term. While a cautious investor must analyze the company, and if GMP and subscription stay in support can apply for the IPO.
Please note:Ā
Investors are advised to make their own decisions and apply entirely at their own risk. This article is written using information from the companyās RHP (Red Herring Prospectus) data and online sources. If you have any queries, kindly contact the IPO Watch Team.
