Sudeep Pharma IPO Closes Today as Subscription Nears 8x

The Sudeep Pharma IPO closes today after a four-day book-building process in the Rs 563 to Rs 593 price band, with listing slated for November 28 on both NSE and BSE. The total issue size is around Rs 895 crore, including a fresh issue of about Rs 95 crore and an offer for sale of nearly Rs 800 crore by existing shareholders. For retail investors, the minimum investment at the upper price band comes to Rs 14,825 per lot.

Subscription Status

Sudeep Pharma saw a total subscription of 7.96 times, with 6.59 times from Retail Investors, 21.55 times from non-institutional investors, and 0.15 times from QIB as of 10:54 A.M dated 25th November 2025.

Company Overview

Sudeep Pharma manufactures mineral-based pharmaceuticals, food, nutrition and specialty ingredients, with a strong presence in high-barrier excipients and preservative systems. Its portfolio includes iron phosphates, calcium phosphates and encapsulated preservatives such as sorbic acid and calcium propionate, which are used by pharma, nutraceutical, food and personal care customers. The company supplies to both domestic and international markets and positions itself as one of the few scaled Indian manufacturers in its niche, benefiting from compliance-heavy, regulated end-user industries.

Fund Utilization

Management plans to use the fresh proceeds mainly for capacity expansion, capex for new product lines and general corporate purposes, while the OFS gives a partial liquidity event to promoters and initial shareholders.

Financial performance

Sudeep Pharma has reported steady revenue and profit growth over the last few years, with an improving margin profile. Operating revenue rose from Rs 428.73 crore in FY23 and Rs 459.28 crore in FY24, followed by Rs 502 crore in FY25. The EBITDA for FY25 was Rs 199.28 crore, which grew at a CAGR of 42.14% from FY23 to FY25. Net profit has trended upward from Rs 62.32 crore in FY23, followed by Rs 133.18 crore in FY24 and Rs 138.69 crore in FY25, implying robust profitability and strong retained earnings growth.

Key strengths

Sudeep Pharma enjoys a niche leadership position in mineral-based excipients and specialty ingredients, a segment with high regulatory and technical entry barriers. Its long operating history, compliance track record and ability to serve global pharma and food clients support sticky customer relationships and pricing power. The company also benefits from relatively high and stable EBITDA margins.

Major risks

The business faces customer concentration risk, as a major portion of revenue comes from a limited set of large customers; any loss or scaling down by these accounts can hurt growth and margins.

Regulatory and compliance risk remains inherent risk because the plants undergo frequent inspections from regulators and multinational clients, and any non-compliance can trigger penalties, shutdowns or loss of business. In addition, raw material price volatility, forex exposure due to sizeable exports and competitive intensity from global ingredient players can pressure profitability over the medium term.

Strategic outlook

Strategically, Sudeep Pharma aims to use IPO proceeds to expand capacity, deepen its product portfolio in high-value ingredients and strengthen R&D to move further up the value chain. Management also appears focused on increasing wallet share with key global customers and diversifying end-user segments within pharma, food and nutrition to reduce concentration risk over time.

For investors, the combination of strong financial momentum, niche positioning and export opportunity is attractive, but the large OFS, customer concentration and regulatory dependencies warrant careful assessment. Take financial advice from an expert to make informed decisions.