Gland Pharma, a maker of injectable drugs out of Hyderabad, has filed a draft red herring prospectus or DRHP for an IPO. Gland Pharma is majority owned by China’s Shanghai Fosun Pharmaceutical. While SEBI approvals are awaited in the light of the present border stand-off, this could be the first major domestic IPO of an Indian company with Chinese parent.

Gland Pharma aims to raise up to Rs.6000 crore, although the final size may predicate on the market conditions and the approvals from SEBI. While the timing of the IPO is not too clear, Gland Pharma may look at an IPO slated in the second half of FY21 depending, by which time market conditions could improve. Focus will dilute its stake via the IPO.

The IPO proceeds are likely to be used for CAPEX and for working capital funding of its Indian operations. Diplomatic relations between India and China have worsened in the recent past and that could be an overhang on the IPO. Also, Indian government banned as many as 59 China-origin mobile apps including the likes of Tik Tok and We Chat.

Gland Pharma is a pure-play generic injectable pharma products company and has been in operation since 1978. Gland derives bulk of its revenues from the US and European markets. Gland pioneered Heparin, an anti-coagulant used during surgeries. The company has seven manufacturing facilities: four at Hyderabad and three at Vizag.