Anthem Biosciences IPO: Should You Subscribe?

The initial public offering (IPO) of Anthem Biosciences Ltd (ABL) opened for subscription today and will close on Wednesday, July 16, 2025. The grey market premium (GMP) for the IPO is hovering around Rs 100, indicating a 17.5% premium.

However, investors are advised to carefully consider both the opportunities and risks before subscribing. For a detailed review, see our comprehensive IPO analysis here.

Anthem Biosciences IPO Details

• Issue Details: Mainstream
• Issue Size: Rs 3,395 crore
• Fresh Issue: -
• Offer for Sale: Rs 3,395 crore
• Price Band: Rs 540 – Rs 570
• Lot Size: 26 shares
• Listing Date: July 21, 2025

Overview of Anthem Biosciences Ltd

ABL provides end-to-end services across the drug discovery, development and manufacturing lifecycle, catering to both New Chemical Entities (NCEs) and New Biological Entities (NBEs). Its key manufacturing facilities are located in Bommasandra and Horahalli, Bengaluru.

Majority of ABL’s revenue—approximately 82%—is generated from its CRDMO (Contract Research, Development and Manufacturing Organisation) business. The remaining 18% comes from its specialty ingredients segment, which focuses on fermentation-based APIs such as probiotics, enzymes, peptides and biosimilars.

Anthem Biosciences Key Strengths

• Diverse Client Base: As of March 31, 2025, ABL served 550+ clients, spanning 44+ countries including the United States, Europe and Japan. According to a Frost & Sullivan Report, ABL had the highest number of clients among its assessed Indian peers as of March 2025. 
• Solid Financial Performance: Between FY23 and FY25, ABL delivered strong financial performance with a 32% CAGR in operating revenue, 24% in EBITDA, and 8% in net profit. Notably, the company recorded the highest revenue growth among its assessed peers in India and globally during FY24–25.
• Healthy Return Metrics: ABL showcases strong operational efficiency, with a Return on Equity (RoE) of 21% and Return on Capital Employed (RoCE) of 27% as of FY25.
• Superior Margin Profile: ABL posted an industry-leading EBITDA margin of 37% and a net profit margin of 23% in FY25, outperforming listed peers.
• Strong Industry Tailwinds: India’s CRDMO industry is one of the fastest-growing globally, expected to expand at a CAGR of 13.4% from 2024 to 2029, driven by a skilled talent pool, government support (IP protection and R&D incentives), cost advantages and global supply chain realignment under the "China plus One" strategy and the US Biosecure Act. These trends are likely to benefit established players like ABL.

Anthem Biosciences Risk Factors

• Client Concentration: As of FY25, approximately 71% of ABL's revenue is derived from its top five customers. A decline in business from these key customers could negatively impact ABL’s operations and financial performance.
• Contingent Liabilities: As of 31 March 2025, ABL reported contingent liabilities of Rs 213 crore, which, if materialized, could adversely affect its financial position.
• Dependence on Overseas Suppliers: ABL's reliance on overseas suppliers has increased, with procurement from these suppliers rising from 24.6% of total material costs in FY24 to 48.41% in FY25. This is largely due to dependence on a single-source supplier in the People's Republic of China (PRC). Any price hikes or disruptions in supply from these sources could negatively affect ABL’s business and financial health.

Final Thoughts: Should You Subscribe to Anthem Biosciences Ltd’s IPO? 

ABL has delivered strong growth between FY23–FY25, backed by industry-leading profit margins. In terms of valuation, the IPO commands a P/E multiple of 71x based on FY25 earnings. 

As per Frost & Sullivan, the Indian CRDMO industry is among the fastest-growing globally, projected to grow at a 13.4% CAGR over the next five years—well above the global average of 9.1%. India’s R&D ecosystem, skilled talent pool, IP protection framework and cost advantage make it a preferred destination for global pharma collaborations.

Additionally, increasing concerns in the West over China’s IP practices and manufacturing dominance strengthen the 'China plus One' narrative, positioning India—and companies like ABL—as key beneficiaries. ABL stands out as one of the few Indian CRDMOs with expertise across both small and large molecule value chains.

Given these factors, investors may consider subscribing to the IPO from a medium-to-long term perspective.

For a deep dive into other IPOs, explore: IPO Corner on Liquide