Pharmaceutical company, Blue Jet Healthcare files for IPO

Chennai: Blue Jet Healthcare Limited, a specialty pharmaceutical and healthcare ingredient and intermediate company, offering niche products targeted towards innovator pharmaceutical companies and multi-national generic pharmaceutical companies has filed its Draft Red Herring Prospectus (DRHP) with the markets regulator, Securities and Exchange Board of India (SEBI), to raise funds through an initial public offering (IPO).

The public issue with a face value of Rs 2 per equity share is a complete offer-for-sale (OFS) of up to 21,683,178 equity shares by Promoter and selling shareholders, which comprises up to 18,366,311 by Akshay Bansarilal Arora, up to 3,316,867 by Shiven Akshay Arora (“Selling Shareholders”). 

Incorporated in the year 1968 as Jet Chemicals by Late Shri BL Arora, Blue Jet Healthcare is promoted by its Executive Chairman; Akshay Bansarilal Arora. The company operates under the “Blue Jet” brand name and has competencies and manufacturing capabilities in contrast media intermediates and high intensity sweeteners, including saccharin and its salts as well as active pharmaceutical ingredients. Its business model focuses on collaboration, development, and manufacturing of complex chemistry categories. Over the past 5 decades, the company has developed over 100 products with over 40 products commercialised.

The company is a net debt-free company as on June 30, 2022. Its revenue outlook is supported by annual and multiyear supply contracts that range from one to four years. 60% of its sales over the last 3 years have been backed by its order visibility. Over the course of three years, the company has catered to more than 350 customers across 35 countries some of them being Colgate Palmolive (India) Ltd, Unilever, Prinova US LLC, MMAG Co Ltd in the high-intensity sweetener space; Hovione Farmacie?ncia, Olon S.p.A., Esperion Therapeutics Inc., and Bial– Portela & CA, S.A for pharmaceutical intermediates, API and CDMO area and GE Healthcare, Guerbet, Bracco, and Cambrex Karlskoga AB, in the contrast media area.

76.06% of Blue Jet’s income in FY22 came from Europe, followed by India (17.14%), the United States of America (4.18%) besides other countries. Its revenue from operations increased by 36.94% to Rs 683.47 crore for the Financial Year 2022 from Rs 498.93 crore for the Financial Year 2021, primarily due to an increase in the revenue from the sales of contrast media intermediate and from the sales of high-intensity sweeteners, while profit after tax increased by 33.73% to Rs 181.59 crore for the financial year 2022 from Rs 135.79 crore for the same period last year.

Saccharin is primarily used in table-top sweeteners, oral care products such as toothpaste and mouthwashes, beverages (primarily soft drinks), confectionary products (such as mints, candies, and bakery products), pharmaceutical products, food supplements, and animal feeds. Globally, the high intensity sweetener market potential stood at $2.4 bn shows promise to grow between 3-8% CAGR between FY 2021-2025

Contrast media are agents used in medical imaging to enhance the visibility of body tissues under X-rays, computed tomography, magnetic resonance imaging, or ultrasound. Globally the contrast media formulations market stood at $6.7 bn and is forecasted to grow between 8-10% CAGR between FY22-25

As of March 31, 2022, it operates three manufacturing facilities, in Shahad, Ambernath, and Mahad in the state of Maharashtra, with an annual installed capacity of 200.60 KL, 607.30 KL, and 213.00 KL, respectively. In efforts of its capacity expansion in FY 21, it acquired a "greenfield" industrial facility on a leasehold basis in Ambernath. By 2025 its total annual production is expected to reach 1,513.6 KL.

Kotak Mahindra Capital Company Limited, ICICI Securities Limited, and J.P. Morgan India Private Limited are the books running lead managers and Link Intime India Private Limited is the registrar to the offer. The equity shares are proposed to be listed on BSE and NSE.

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