Remus Pharmaceuticals Limited

Remus Pharmaceuticals Limited is engaged in marketing & distribution of finished formulations of pharmaceutical drugs. The company also deals in API (Active Pharmaceutical Ingredient). They also provide technical consultancy services to various distributors for preparation of reports on the dossiers of the products to be registered by them in various countries. The Company is majorly engrossed in the pharmaceutical business involving marketing, trading and distribution of wide range of pharmaceutical finished formulations and products. Depending upon business requirments, they get finished pharmacuetical formulations manufactured on loan license or contract manufacturing. Such manufacturing is on principle to principle basis. They have the presence through registered and/or under registration products in countries namely Bhutan, Bolivia, Chile, Costa Rica, Cuba, Dominican Republic, Ecuador, El Salvador, Guatemala, Honduras, Jamaica, Kuwait, Madagascar, Malaysia, Hong kong, Myanmar, Panama, Trinidad and Tobago, Uzbekistan, Venezuela, Vietnam. Company deals in drug forms like Capsules, Cream, Eye Drops, Gel, Infusion, Inhalation, Inhaler, Injection, Nail Lacquer, Nasal Solution, Nasal Spray, Nebuliser, Ointment, Ophthalmic, Oral Gel, Oral Solution, Oral Suspension, Sachet, Suspension, Tablet. The product portfolio consists of 429 products, as on January 31, 2023. They operate under different brand names across the globe. As on January 31, 2023, they have 295 products registered in total 13 countries. As on January 31, 2023, total 134 products are under process of registration in 16 countries, which shall boost the growth of the company. As per financial performance, Remus Pharmaceuticals Limited has posted total income/net profits of Rs 12.76 Cr / Rs 0.81 Cr (FY20), Rs 19.22 Cr / Rs 1.02 Cr (FY21), Rs 24.43 Cr / Rs 3.38 Cr (FY22) and Rs 33.61 Cr / Rs 6.43 Cr (upto 9M FY23), So company has shown very good growth, but this kind of jump in net profit just before IPO raises concerns. Company has posted an average EPS of Rs 21.70/- and average RoNW of 44.24% for last three fiscals. Issue is priced at a P/BV of 7.79 as per NAV of Rs 157.59/- as on 31.12.22. As per FY22 earnings on fully diluted equity post issue, asking price is at P/E of around 53.48 and as per annualised FY23 earnings P/E 21.09. As per RHP, comparison between listed peers is shown in above table. On BRLM's front, Beeline Capital Advisors Private Limited associated with this SME IPO and handled 12 SME IPOs in last 1 years. From last 10 SME IPOs, all opened above issue price or at par on the listing day. As of now from last 10 IPOs, 4 is trading below and remaining are trading above issue price or at par. ( As on 10.05.2023) As Per financials, Remus Pharmaceuticals Limited has shown good results, RoNW is 44.24% and P/E is respectively 53.48 and 21.09 as per FY22 and annualised FY23 earnings, which looks aggressively priced, also sudden rise in net-profit in just before IPO raises concerns. Company is in pharmaceutical business and its more than 99% revenue comes from export. Also company doesn't have any manufacturing facility. This sector is highly competitive. Performance of BRLM is average post listing. So we are giving NEUTRAL rating to this SME IPO.

• 1 Mr. Arpit Deepak kumar Shah
• 2 Ms. Roma Vinodbhai Shah
• 3 Mr. Swapnil Jatinbhai Shah
• 4 Mrs. Anar Swapnil Shah