Is Sudeep Pharma IPO Good or Bad – Detailed Review

Sudeep Pharma Limited’s IPO is set to open its initial public offering from November 21, 2025, to November 25, 2025. When considering applying for this IPO, potential investors might have questions about whether the Sudeep Pharma IPO is a good investment and if it's worth subscribing to.

This article provides a comprehensive Sudeep Pharma IPO review, covering its business operations and fundamental analysis to help you make an informed investment decision.

Sudeep Pharma IPO Review

Sudeep Pharma Limited's IPO is open for subscription from November 21, 2025, to November 25, 2025, with listing expected on November 28, 2025, on NSE and BSE.

The company is a global, technology-led manufacturer offering advanced, high-purity ingredients and specialty solutions primarily to large enterprise customers globally in the pharmaceutical, food, and nutrition sectors. It specialises in chemical engineering innovation to design, develop, and implement regulatory-compliant, secure, and highly scalable manufacturing processes for excipients, Active Pharmaceutical Ingredients (APIs), and complex nutritional compounds.

The platform has a significant global presence, catering to over 1,100 customers across around 100 countries as of June 30, 2025. Its core operational strength is maintaining long-term relationships, with the average client vintage for its top five customers standing at 7.08 years as of June 30, 2025. The promoters hold an aggregate of 89.37% of the pre-offer paid-up equity share capital.

The company operates within the competitive global chemical manufacturing sector, specialising in pharmaceutical excipients and speciality nutritional ingredients. The Global Pharmaceutical Excipients Market, Sudeep Pharma's core domain, was valued at approximately USD 10.4 billion in 2024 and is projected to grow at a global CAGR of 4.7% to reach USD 13 billion by 2029. Concurrently, the Global Nutritional Ingredients Market was valued at USD 99 billion in 2024 and is expected to grow at a CAGR of 6.8% to 2029.

Sudeep Pharma’s financial performance from FY23 to FY25 reflects robust top-line growth coupled with strong margin expansion. Revenue from operations grew strongly from Rs 428.74 crores in FY23 to Rs 502 crores in FY25 (CAGR of 8.21%).

Profit After Tax (PAT) surged, more than doubling from Rs 62.32 crores in FY23 to Rs 138.69 crores in Fiscal 2025 (CAGR of 49.20%). Operating efficiency showed strong expansion, with the EBITDA margin improving dramatically from 23.01% in FY23 to a robust 39.70% in FY25. The Return on Capital Employed (RoCE) rose from 28.96% in FY23 to 29.53% in FY25 (peaking at 40.65% in FY24).

Strengths include Market Leadership with a diversified product portfolio of over 100 products, a Distinguished Global Customer Base with long-standing relationships, well-equipped and globally compliant facilities (USFDA, WHO-GMP), and strong R&D capabilities driven by proprietary platforms.

Risks include Significant Revenue Concentration (Top 10 customers accounted for 42.10% of consolidated revenue for Q1FY26), Negative Cash Flow from Operating Activities (Rs 5.484 crores for Q1 FY26) with a high working capital cycle (344 days), High Reliance on Key Suppliers (Top 10 suppliers contributed 65.40% to raw material costs), and Execution Risk in diversification (pCAM) and acquisition (NSS, Ireland).

The IPO consists of a total issue of 1,50,92,750 shares valued at Rs 895 crores, comprising an Offer for Sale (OFS) of 1,34,90,726 shares (Rs 800 crores) and a Fresh Issue of 16,02,024 shares (Rs 95 crores). The fresh issue proceeds will be used for capital expenditure and general corporate purposes.

The shares are priced in the band of Rs 563 to Rs 593 per share, with a lot size of 25 shares.

Company Overview of Sudeep Pharma IPO

Sudeep Pharma is a global, technology-led manufacturer offering advanced, high-purity ingredients and specialty solutions primarily to large enterprise customers in the pharmaceutical, food, and nutrition sectors worldwide. The core focus is on chemical engineering innovation to design, develop, and implement regulatory-compliant, secure, and highly scalable manufacturing processes for excipients, active pharmaceutical ingredients (APIs), and complex nutritional compounds.

The company is driven by a mix of deep domain expertise in mineral chemistry and patented product engineering capabilities. The vertical depth is rooted in the specific needs of pharmaceutical formulation and consumer nutrition, serving global manufacturers of oral solid dosage forms, major food and beverage companies, and nutraceutical brands across regulated markets like the US and Europe. Sudeep Pharma’s facilities maintain globally recognised certifications, core to its commitment to quality, consistency and traceability.

Its core business strength is built around an integrated suite of advanced, proprietary products for the ingredient lifecycle:

• Presscal

• Pressmag

• Novelcap

• Lipoboost

• WEDRGRAN

• Tritunova

• EcoCath

This robust product portfolio supports customers across its main business verticals, like Pharmaceutical Excipients and APIs, Specialty Nutritional Ingredients, and Advanced Materials (pCAM). The company is recognised for cultivating long-term relationships, with the average tenure for its top five customers standing at 7.08 years as of June 30, 2025. The company maintains a significant global footprint, catering to over 1,100 customers across around 100 countries as of June 30, 2025.

The geographic split of the revenue from operations for the three months ended June 30, 2025, is detailed below:

In the business-wise segment, they have 2 categories, namely (based on 3 months ended June 30, 2025)

• Pharmaceutical, Food and Nutrition - 66.43%

• Specialty Ingredients - 33.57%

The Company’s Promoters are Sujit Jaysukh Bhayani, Avani Sujit Bhayani, Shanil Sujit Bhayani, Sujeet Jaysukh Bhayani HUF, Riva Resources Private Limited, and Bhayani Family Trust.

Sujit Jaysukh Bhayani serves as the Managing Director and Chairman, and Shanil Sujit Bhayani and Ajay Shrirang Kandelkar are Whole-time Directors. Ketan Jagdishchandra Vyas is the Chief Financial Officer. The promoters hold an aggregate of 89.37% of the pre-offer paid-up equity share capital.

Industry Overview of Sudeep Pharma IPO

Sudeep Pharma Limited operates within the competitive global chemical manufacturing sector, specialising in pharmaceutical excipients, speciality nutritional ingredients, and advanced materials. The sector is undergoing transformation driven by rising patient-centric drug formulations and government-led fortification mandates.

The Global Pharmaceutical Excipients Market, a key domain for Sudeep Pharma, serves as a primary Total Addressable Market (TAM). This market was valued at approximately USD 10.4 billion in 2024 and is projected to reach USD 13 billion by 2029, reflecting a strong CAGR of 4.7% from 2025 to 2029. Concurrently, the Global Nutritional Ingredients Market was valued at USD 99 billion in 2024 and is expected to grow at a CAGR of 6.8% to 2029, indicating robust demand.

The chemical and ingredient supply sector is characterised by intense regulatory scrutiny and demanding technological requirements. Sudeep Pharma differentiates itself through its extensive USFDA and WHO-GMP certifications, coupled with proprietary technologies like CASPRA (spray drying) and WEDRGRAN (granulation). However, the sector faces several structural challenges, such as:

• High Development Cost and Regulatory Barriers: The development of novel excipients and custom formulations is highly capital-intensive and time-consuming, frequently taking six to seven years to bring a product to market.

• Supply Chain Disruption and Price Volatility: The industry faces challenges related to securing stable, high-purity raw materials such as mineral calcium and phosphoric acid and managing logistics.

• Quality Control and Liability Exposure: Maintaining consistent, high-quality across all batches is critical due to the sensitive nature of pharmaceutical and infant nutrition products.

• Competitive Fragmentation: The market for nutritional ingredients remains highly fragmented, with competition from large global majors like BASF and Ashland, who leverage acquisitions and product innovation, putting pricing pressure on mid-tier players.

Financial Overview of Sudeep Pharma IPO

Revenue from Operations has demonstrated strong and consistent expansion, driven by increasing sales volumes in both domestic and export markets. Revenue rose from Rs 428.74 crore in FY23 to Rs 459.28 crore in FY24 and further to Rs 502 crore in FY25, representing a CAGR of 8.21%.

Adjusted Gross Margin reflects high production efficiency and value-added capabilities. The margin has expanded significantly from 57.44% in FY23 to 64.01% in FY24 and further to a peak of 67.17% in FY25. This consistency underscores the company's commanding position in the specialty ingredient segments and effective control over input costs.

EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation) has shown substantial growth, nearly doubling over two years. EBITDA increased sharply from Rs 98.64 crore in FY23 to Rs 187.76 crore in FY24 and further to Rs 199.28 crore in FY25. This remarkable growth is indicative of strong operating leverage and operational scale.

EBITDA Margin reflects improved profitability at the operating level. The margin expanded dramatically from 23.01% in FY23 to 40.88% in FY24, reflecting efficiency gains. It remained robust at 39.70% in FY25, demonstrating the company's ability to retain value across its global sales channels.

Profit after tax (PAT) has surged, reflecting both margin expansion and favourable tax rates. PAT more than doubled from Rs 62.32 crore in FY23 to Rs 133.19 crore in FY24, achieving further growth to Rs 138.69 crore in FY25. This translates to a high CAGR of 49.20% over the period.

Return on Equity (RoE) demonstrates strong capital generation capability. RoE was high at 27.54% in FY23, peaked at 37.09% in FY24, and maintained a strong level of 27.88% in FY25.

Return on Capital Employed (RoCE) mirrors the high efficiency in utilising total deployed capital. RoCE followed a similar strong pattern, rising from 28.96% in FY23 to 40.65% in FY24 and remaining elevated at 29.53% in FY25.

Strengths and Risks of Sudeep Pharma IPO

Let's examine the strengths and weaknesses to determine if the Sudeep Pharma IPO is a good or bad investment for investors.

Strengths

• Market Leadership with Diversified Product Portfolio: The company is a leading manufacturer in its field, focusing on mineral-based products and iron phosphate, backed by a diverse portfolio of over 100 products as of June 30, 2025.

• Distinguished Global Customer Base and Long-Standing Relationships: Sudeep Pharma has served over 1,100 customers across approximately 100 countries and maintains long-term relationships with marquee clients, including 14 global Fortune 500 companies. The average tenure of its top five largest customers is 7.08 years as of June 30, 2025.

• Well-equipped and Globally Compliant Facilities: The company operates four strategically located manufacturing facilities (three in Gujarat and one in Ireland), holding comprehensive global approvals, including USFDA approval for mineral-based ingredients, CEP, WHO-GMP, and EXCiPACT certifications.

• Strong Research and Development (R&D) Capabilities: The business is driven by specialised R&D focusing on particle engineering, bioavailability, and novel formulations. The company utilises proprietary platforms and has commercialised 127 products or variants in recent years.

• Experienced Promoters and Senior Management Team: The company benefits from leadership with deep sector experience, notably Sujit Jaysukh Bhayani (Managing Director & Chairman), with 34 years of industry experience, providing stable governance and strategic direction.

Risks

• Significant Revenue Concentration on a Limited Customer Base: The company generates a substantial portion of its revenues from a limited number of customers. The top 10 customers collectively accounted for 42.10% of the consolidated revenue from operations for the three months ended June 30, 2025, posing a risk if any of these key relationships are lost.

• Negative Cash Flow from Operating Activities: The company recorded negative net cash flow from operating activities of Rs 5.484 crores for the three months ended June 30, 2025, and high working capital requirements are reflected in the 344-day Net Working Capital Cycle, which may strain future liquidity.

• High Reliance on Key Suppliers and Raw Material Volatility: There is a high dependency on a small pool of suppliers for raw materials like phosphoric acid and sorbic acid, with the top 10 suppliers contributing 65.40% to the total cost of raw materials in the most recent reported period. The lack of long-term contracts exposes the company to price and supply interruptions.

• Geographic Concentration and Export Risk: The business is exposed to regional economic and political shifts, with 58.68% of its revenue from operations derived from export sales and three of its four primary manufacturing and R&D facilities concentrated in a single region (Vadodara, Gujarat).

• Execution Risk in Diversification and Acquisition: The company faces risks related to integrating the newly acquired NSS (Ireland) entity and the successful commissioning and scaling of its new line of business into pCAM (battery precursor materials) through its subsidiary, SAMPL, which involves limited prior management experience in this specialised sector.

Strategies of Sudeep Pharma IPO

• Expansion into High-Growth Advanced Materials: The core strategy includes leveraging mineral chemistry expertise to expand into the manufacturing of precursor cathode active materials (pCAM), starting with battery-grade iron phosphate for use in Lithium Iron Phosphate (LFP) batteries for electric vehicles and energy storage systems (via SAMPL).

• Leverage Regulatory Approvals for Regulated Market Penetration: The strategy involves capitalising on stringent global certifications to increase export volumes of key ingredients like calcium carbonate and iron phosphate, particularly by strengthening presence and moving to direct market access in the US and Europe.

• Develop and Expand Advanced Technology Product Lines: A strategic focus on innovative, technology-driven solutions, specifically launching and scaling penetration of the Lipoboost (liposomal ingredients) and Novelcap (encapsulated ingredients) product lines into global nutraceutical and functional food markets.

• Capitalize on Public Health Fortification Initiatives: The company aims to leverage its expertise in micronutrient premixes to actively participate in large-scale government and organizational fortification programs, including rice fortification in India and related initiatives in Africa and Southeast Asian countries, addressing nutritional deficiencies.

• Integrate Inorganic Growth and Enhance Manufacturing Capabilities: The strategy involves the ongoing integration of the Nutrition Supplies and Services (NSS) acquisition in Ireland to strengthen the European footprint and a continued focus on expanding manufacturing capacity and implementing process automation in India to enhance efficiencies and meet growing global demand.

Sudeep Pharma IPO vs. Peers

Sudeep Pharma Limited operates within the highly technical and heavily regulated pharmaceutical excipients and Specialty Ingredients Market. This sector demands precise quality standards and significant investments in R&D and regulatory compliance.

As per the Red Herring Prospectus, the company has mentioned that "There are no peer group companies listed in India which are in the same line of business as our Company."

Given this limitation, competitive positioning and valuation are assessed contextually against major global players whose financial data are presented solely for benchmarking scale and market characteristics, as disclosed in the RHP's comparative analysis section.

Key Players in the Global Excipients and Nutrition Market

The table below presents selected operational and financial data for large, integrated global entities operating in the pharmaceutical excipients and nutritional ingredients space, compared against Sudeep Pharma's scale:

Note: Financial data for global companies (DSM-Firmenich, Glanbia Nutritionals, Jost Chemical, Balchem) are based on the latest available reported data for the calendar year 2024 (Actual) as disclosed in the RHP, converted for comparison purposes at the RHP's exchange rate of Rs 83.37 per $1 USD (as of March 31, 2024).

The company showcases a niche but profitable position within the competitive landscape. Sudeep Pharma's scale, while significantly smaller than the integrated global majors like DSM-Firmenich and Glanbia, is complemented by its strong margin profile, competitive manufacturing infrastructure, and high regulatory compliance.

Note: There are no listed peers in India for Sudeep Pharma, as explicitly stated in the Red Herring Prospectus. The information above is provided solely for competitive context in the global excipients and specialty chemicals sector using available comparative data, as disclosed in the Red Herring Prospectus.

Objectives of Sudeep Pharma IPO

The offering consists of a total of 1,50,92,750 shares worth Rs 895 crores, out of which the offer for sale of 1,34,90,726 shares is valued at Rs 800 crores, and the fresh issue of 16,02,024 shares is valued at Rs 95 crores. The selling shareholders in this IPO are:

Sujit Jaysukh Bhayani, Sujeet Jaysukh Bhayani HUF, Shanil Sujit Bhayani, and Avani Sujit Bhayani will receive the offer for sale proceeds.

However, the fresh issue proceeds will be used for the following objectives:

• Capital Expenditure towards machine procurement for the production line located at Nandesari Facility I (Rs 75.81 crores)

• General Corporate Purposes (Rs 19.19 crores)

Sudeep Pharma IPO Details

IPO Dates

Sudeep Pharma IPO will be open for subscription from November 21, 2025, to November 25, 2025. The allotment of shares to investors will take place on November 26, 2025, and the company is expected to be listed on the NSE and BSE on November 28, 2025.

IPO Issue Price

Sudeep Pharma is offering its shares in the price band of Rs 563 to Rs 593 per share. This means you would require an investment of Rs. 14,825 per lot (25 shares) if you are bidding for the IPO at the upper price band.

IPO Size

Sudeep Pharma is issuing a total number of 1,50,92,750 shares valued at Rs 895 crores, out of which the offer for sale comprises 1,34,90,726 shares, worth Rs 800 crores, of which the selling shareholders will receive the proceeds. The remaining 16,02,024 shares worth Rs 95 crores will be of fresh issue, used for the objects of the issue.

IPO Allotment Status

Investors who applied for the IPO can check their IPO allotment status on November 26, 2025, through the registrar's website, MUFG Intime India Private Limited, BSE, NSE, or through the stockbroker platform.

IPO Listing Date

The shares of Sudeep Pharma are expected to be listed on the NSE and BSE on November 28, 2025.

IPO Application Link

Open demat account with Rupeezy today and enjoy a seamless experience when applying for the IPO. With an easy-to-use platform, Rupeezy makes the IPO application process quick and hassle-free.

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