Offer for Sale of AGP – Largest IPO in Pakistan’s Pharmaceutical Industry

AGP Limited, a part of OBS Group, the 8^th largest Pharmaceutical Group in Pakistan successfully raised PKR 2.8 billion from foreign institutional investors, local institutional investors and the general public. The IPO was entirely managed by JS Global Capital Limited in their capacity as the Consultant to the Issue. AGP is the first public offering of a Pharmaceutical company after a gap of over 23 years and therefore would result in a significant improvement in the depth of the local pharmaceutical sector at the Pakistan Stock Exchange.

The success of the IPO can be gauged from the fact that, both Book Building and General Public Portions of the IPO received overwhelming response despite tough market conditions (Book Building portion subscribed by 160%; General Public portion subscribed by 112%). Total demand in the Book Building was received in excess of PKR 5.0 billion, whereas the same from the General Public also stood at PKR 784 million, which also rendered it as one of the largest private sector Public Offerings in Pakistan. Quality of investors in the Book Building was evident as 84% of the Offer was subscribed by Institutional Investors. One key highlight of this landmark offering was participation of the Foreign Institutional Investors (16%), which is unprecedented in recent time. This has also raised the bar for domestic companies attracting foreign institutional money.

AGP is spearheaded by a highly capable team of professionals boasting rich experience in pharmaceutical and healthcare sector, having served in large multinational and domestic corporates. The Company specializes in manufacturing, marketing and sales of pharmaceutical and healthcare products, many of which are market leaders in their respective categories. AGP has a unique combination of brands acquired from global pharmaceutical companies of international repute, as well as its own range of branded generics. In order to reach the next stage of growth, AGP has partnered with Mylan USA, the world’s second largest generic drug manufacturer. In 2016, AGP launched a hepatitis-C drug, MyHep, which is a bio-equivalent of Sovaldi. Additionally, the Drug Regulatory Authority of Pakistan (DRAP) has recently approved the pricing of a breast cancer treatment drug which is expected to provide an affordable treatment option to many, and become a block-buster drug considering the high occurrence of breast cancer in Pakistan.

The success of any pharmaceutical company greatly depends on its distribution network. In this regards, the delivery of AGP’s products, across the country, is managed by Muller & Phipps (M&P), the largest pharmaceutical distributor in Pakistan with coverage across 1,850 towns and over 32,400 pharmacies throughout the country. M&P ensures the widest and most efficient outreach for AGP’s products.

The pharmaceutical industry has been resilient over economic cycles, growing at a sustained CAGR of around 13% over the last 5 years owing to a strong population growth rate of 2% along with rising income levels. The Drug Pricing Policy has also provided pharmaceuticals with the much needed price support that was missing since the past twelve years. The industry is expected to witness strong growth well into the future due to favourable dynamics. To celebrate the successful completion of the IPO process and other formalities, management of AGP Limited had a cake-cutting ceremony, where Mr. Tariq M. Khan, Chairman AGP Limited and OBS Group, Ms. Nusrat Munshi, CEO AGP Limited, and Kamran Nasir, CEO JS Global, were present, amongst others. Trading of AGP shares at the Pakistan Stock Exchange is scheduled to commence at 9:30am, Monday, 5^th March, 2018.