Veeda Clinical Research refiles DRHP with SEBI for IPO
Veeda Clinical Research has refiled its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) for an initial public offering (IPO). The company, founded in 2004, offers clinical trial services globally. Veeda had previously submitted its IPO documents to SEBI on September 27, 2021. The IPO includes a fresh issue of shares totalling up to ₹185 crores and an offer-for-sale of up to 13 million equity shares by existing shareholders.
Company Overview
Veeda Clinical Research is a full-service contract research organization (CRO). It provides services across the drug development and launch value chain. Veeda offers early and late-phase clinical trials, Healthy Volunteer Studies (HVS), pre-clinical trials, non-clinical testing, and biopharma services. The company's services include bioavailability and bioequivalence studies, as well as clinical bioanalysis for large molecules. Veeda has a global presence with operations in North America, Europe, and Asia. The company has a history of adhering to regulatory standards, having completed 119 global regulatory inspections for its HVS and pre-clinical services. Veeda has expanded from a single facility in Ahmedabad to four facilities in Ahmedabad and one in Mehsana, as well as two facilities in Bangalore.
IPO Structure and Objectives
The IPO has a face value of ₹2 per share. It comprises a fresh issue of shares worth ₹185 crore and an offer-for-sale of up to 13 million equity shares. The offer-for-sale includes shares from several investors:
- Basil Private Limited: Up to 3,493,895 equity shares.
- Bondway Investments Inc.: Up to 7,359,620 equity shares.
- Dr. S N Vinaya Babu: Up to 810,000 equity shares.
- Sabre Partners AIF Trust: Up to 690,210 equity shares.
- CX Alternative Investment Fund: Up to 198,795 equity shares.
- Anushka Singh: Up to 210,570 equity shares.
- Vikrampati Singhania: Up to 81,694 equity shares.
- Harsh Pati Singhania: Up to 40,847 equity shares.
- Anshuman Singhania: Up to 40,487 equity shares.
- Siddharth Ramesh Kejriwal: Up to 34,000 equity shares.
The funds raised from the fresh issue will be allocated as follows:
- ₹50 crore for capital expenditures related to the acquisition of equipment and machinery.
- ₹35 crore for capital expenditures in its subsidiary, Bioneeds India Private Limited, for equipment and machinery.
- ₹10.89 crore for the repayment or pre-payment of specific borrowings of Bioneeds India Private Limited.
- ₹33 crore to support organic growth through marketing, technology upgrades, and digital solutions for Veeda, Bioneeds India Private Limited, and Health Data Specialists (Holdings) Ltd.
- General corporate purposes.
Business Operations and Market
Veeda's services include a wide range of clinical trials and bioanalytical services. The company has experience with pharmacokinetics (PK) studies, generic drugs, novel chemical entities (NCEs), and biosimilar trials. As of March 31, 2021, they had a total capacity of 532 beds and a monthly capacity of 100,000 samples across their facilities. The company has a strong presence in the Indian CRO market, which is expected to grow rapidly. The company's total addressable market (TAM) is projected to grow from $65.4 billion in 2023 to $110.7 billion by 2028. The company's service distribution includes clinical trials (43.31%), HVS (36.79%), pre-clinical trials (19.66%), and biopharma studies (0.24%). As of September 30, 2024, Veeda had over 436 active clients globally.
Financial Performance and Growth
Veeda has demonstrated consistent growth, with its operational revenue increasing at a CAGR of 16.18% from the Financial Years 2022 to 2024. For the six months ended September 30, 2024, the company's revenue from operations stood at ₹305.30 crore. Veeda has made strategic acquisitions, including 100% equity shares of Heads in March 2024 and a stake in Bioneeds India Private Limited in 2021.
IPO Management
The book-running lead managers for the IPO are Axis Capital Ltd, CLSA India Private Ltd, IIFL Capital Services Ltd, and SBI Capital Markets Ltd. MUFG Intime India Private Ltd is the registrar for the issue. The equity shares are proposed to be listed on the National Stock Exchange of India Limited and BSE Limited. The IPO will follow a book-building process, with allocations to qualified institutional buyers, non-institutional bidders, and retail individual bidders.
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