Accretion Pharmaceuticals Makes NSE SME Debut at ₹79 with 21.78% Discount

Accretion Pharmaceuticals Limited is a fast-growing company in the pharmaceutical sector. It is now ready to launch its shares on the NSE SME platform. The company offered its Initial Public Offering (IPO) from May 14 to May 16, 2025. Accretion Pharmaceuticals came up with its book-building issue of ₹29.75 crores with a fresh issue of 29.46 lakh shares.

The company is based in Sanand, Gujarat, and is mainly involved in making and selling medicines. Its products comprise tablets, capsules, syrups, and medicated creams. It also provides contract manufacturing of products for various companies in the healthcare industry.

Don’t Miss Out on the Next Big IPO – Invest With Just a Few Clicks!

Open Account Now

Accretion Pharmaceuticals Listing Details

The IPO price band is fixed at ₹101 per share, with a minimum lot size of 1,200 shares. This means that retail investors needed to invest ₹1,21,200 to apply. Investors were advised to bid at the cutoff price due to high demand and possible oversubscription.

Listing Price: The shares are listed on the NSE SME platform on May 21, 2025, at ₹79 per share. The estimated market capitalisation at listing stood at ₹112.27 crore.

Investor Sentiment: Due to consistent revenue growth, export-oriented business, positive net income, and ₹5.24 crore as of 31 December 2024, investors showered the IPO with a great deal of interest.

First-Day Trading Performance Outlook

Accretion Pharmaceuticals IPO is listed on the NSE SME platform at ₹79 per share, aligning with expectations of a stable to modest debut. The company’s strong financial growth, consistent exports, and presence in over 30 countries helped generate a positive response from the market. However, with a post-issue P/E of 16.08, some investors remain cautious, as valuation comfort may depend on the sustainability of recent profit growth in the competitive pharma manufacturing space.

Market Sentiment and Analysis

Accretion Pharmaceuticals, founded in 2012, makes and sells a wide range of pharma products and exports to over 30 countries. Its certified facility and strong product mix have helped it grow steadily.

Investor Response: Investors showed strong interest due to its rising profits, high ROE of 72.47%, and export-based business.
Financial Strength: The company reported a profit of ₹3.88 crore in FY 2023–24 and improved its earnings per share (EPS) from ₹4.74 to ₹6.28 after the IPO, showing strong growth in profitability.

Growth Drivers and Challenges

Accretion Pharmaceuticals shows strong growth potential backed by exports and product diversity. However, it also faces challenges like high debt and thin margins due to its B2B business model. Investors should also watch for the sustainability of its recent profit jump. Here are some key growth drivers and challenges to consider:

Growth Drivers:

• Global Reach: Presence in over 30 countries supports revenue diversification.
• Wide Product Range: Offers tablets, syrups, ointments, and herbal products across segments.
• Strong Certifications: ISO certification boosts trust and market access.
• Rising Profits: Net profit improved to ₹5.24 crore in Dec 2024, reflecting better scale and execution

Challenges:

• High Debt Burden: Debt-to-equity ratio of 2.52 limits financial flexibility.
• Thin Margins: Contract manufacturing keeps profit margins low.
• Volatile SME Platform: Limited liquidity may affect stock stability post-listing.
• Profit Sustainability: A Sudden spike in earnings raises questions on future consistency.
   

Utilisation of IPO Proceeds

Accretion Pharmaceuticals plans to use the IPO funds to strengthen its operations and support future growth. The focus is on expanding capacity, improving infrastructure, and managing working capital needs. Here’s how the funds will be utilised:

• Upgrade Manufacturing Facility:₹4.65 crore will be used to modernise and expand the existing production unit.
• Purchase of New Equipment: ₹2.70 crore will go towards buying advanced machinery for better efficiency and output.
• Repayment of Borrowings:₹99 lakh will be used to reduce existing debt and improve the balance sheet.
• Working Capital Needs:₹14.68 crore will support daily operations, raw material purchases, and export demand.
   

Financial Performance of Accretion Pharmaceuticals

The Accretion Pharmaceutical company nowadays has been evolving with growing revenues and improving profitability. Here are three key highlights:

• Revenue Increase: Revenue from ₹29.53 crore during FY23 has increased to ₹35.75 crore, expected in December 2024, showing a continuous increment.
• Profitability Rebound: The net profit rose sharply from ₹0.10 crore in FY23 to ₹5.24 crore in December 2024, depicting margin improvement and scaling.
• Net Worth Strengthens: The net worth for the company rose from ₹3.84 crore in FY23 to ₹13.58 crore by December 2024, contributed by retained earnings as well as profit growth.

Accretion Pharmaceuticals has taken the right move by listing itself on the SME platform. The company is among the prominent players in the pharmaceutical sector. Accretion Pharmaceuticals manufactures and sells healthcare products such as tablets, Capsules, Oral Liquids, and many more. Although some risks are associated with the company, such as high debt and market change, the company is overcoming these risks with the help of strong investor interest and by focusing on a quality product. With the steps, such as improving product quality, expanding R&D, enhancing financial transparency, attracting investors, and widening its distribution network, the company can grow and become more prominent in the market.