Concord Biotech makes a strong debut on Dalal Street; what should investors do?

Concord Biotech — an Ahmedabad-based research and development-driven biopharmaceuticals company — made a strong entry in the listed space on Friday, August 18. Concord Biotech shares began their journey in the secondary market at Rs 900.1 apiece on BSE and NSE each, a premium of Rs 159.1 or 21.5 per cent over the upper end of the price range of its IPO. 

The listing of Concord Biotech shares, traded with the symbol CONCORDBIO, was better than Zee Business Managing Editor Anil Singhvi's expectations. The stock finished the listing day at Rs 941.9 and Rs 943.5 on BSE and NSE respectively — a premium of around 27 per cent.

The Concord Biotech IPO concluded last week with an overall subscription of almost 25 times the equity on offer.

EDITOR'S TAKE | Long-term investors must hold

Singhvi — who had expected the stock to debut in the range of Rs 840-870, a premium of up to 17 per cent — suggests long-term investors hold on to Concord Biotech shares for a target price of Rs 1,100-1,200, which implies an upside of 61.9 per cent from the issue price. 

Short-term investors can also hold on to their positions, with a stop loss at Rs 825 apiece, he said. 

Concord Biotech IPO

The IPO of Concord Biotech, which was open for subscription from August 4 to August 8, received bids for a total of 36.4 crore shares, marking a subscription of 24.9 times against the 1.5 crore shares on offer, according to provisional exchange data. 

Under the IPO, Concord Biotech shares were available for bidding in a range of Rs 705-741 in multiples of 20, translating to Rs 14,100-14,820 per lot. The initial share sale comprised an offer for sale (OFS) worth up to Rs 1,551 crore by promoters and existing shareholders. 

What does Concord Biotech do?

Concord Biotech manufactures active pharmaceutical ingredients (API) through a fermentation and semi-synthetic process, and finished formulations. Founded in 2000, Concord Biotech has transformed from a single-product company to a broad-spectrum solution provider, offering products across diversified therapeutic segments. It is globally known for its products with a presence in more than 70 countries, with efficient distribution infrastructure in markets like the US, Europe, Japan, Latin America, Africa and Asia, besides a significant presence in India, according to its website.

The company has two API manufacturing units and one finished formulation unit, all located near Ahmedabad, Gujarat.

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