PharmEasy is a consumer-facing healthcare website that provides access to online prescription drugs, diagnostic procedures, and medical consultations. In 2015, Dharmil Sheth and Dr. Dhaval Shah launched this business. The business of this company is handled by its parent company, API Holdings Limited.
PharmEasy stands apart due to its strong supply chain capabilities, cutting-edge technology, and thorough comprehension of the dynamic interactions between the many sub-segments of the Indian healthcare sector. The PharmEasy platform offers users online tools and health and wellness information. Additionally, it provides teleconsultation services and sends out supplies and equipment, along with diagnostic tests and treatment methods. In turn, this makes it possible for API Holdings to
connect with a wide range of stockholders across the country. Additionally, the company is currently awaiting SEBI’s approval before launching a public offering to list its shares on bourses.
Objectives of PharmEasy IPO
PharmEasy aims to raise Rs. 6,250 crores through an initial public offering (IPO). Further objectives of this initial public offering are stated below:
- The sum of Rs. 1,929 crore would be used to repay or pay off current borrowings.
- The initiatives for organic growth would be supported with a budget of Rs. 1,259 crore.
- Additionally, Rs. 1,500 crore would be allocated to support inorganic growth. A number of strategic initiatives and acquisitions are anticipated to be used to achieve this expansion.
- The balance will provide support for any other corporate needs.
Why Should I Invest in PharmEasy IPO?
- To all stakeholders, PharmEasy offers a value proposition. The business provides services to 87,194 pharmacies, 3,261 wholesalers, 4,617 clinics and doctors who write prescriptions, and 926 hospitals. 25 million individuals have signed up for the online marketplace.
- When customers use this company’s marketplace to get their prescriptions, they can also get teleconsultation services from them. API Holding Limited uses this market as a distribution channel for services related to the management of chronic diseases and diagnostic tests.
- The biggest online retailer of pharmaceutical products and healthcare services in India is PharmEasy. In order for Axelia to run the company’s marketplace in India, the company licensed the name “PharmEasy” to her. For offline pharmacies owned and run by franchisees, they also provide franchisor services, including marketing, fulfilment, and digital enablement.
- The company uses modern technologies, including LAMP, J2EE, MEAN stacks, and new-age programming constructs. The firm has also developed several custom algorithms with the help of data science models, AI/ML techniques, and specialised workflows to support its business.
- The amount of healthcare-related data that PharmEasy collects and analyses each day is enormous. By providing greater decision-making support, the organisation may aid the stakeholders. Further, the data helps them identify supply trends and optimise their tactics to fulfil market demand.
- The company’s M&A division looks at potential merger and acquisition targets in the country’s fragmented healthcare market. This team has looked to acquire companies with complementary or synergistic strengths in order to unify the fragmented industry and grow into new markets. The importance of this convergence for PharmEasy’s stakeholders throughout the healthcare ecosystem has expanded considerably.
- PharmEasy views its supply chain as a resource and concentrates on providing real-time visibility into the demand trends and precise supply of the company’s healthcare partners. The company also offers delivery estimates for incoming orders as well as a live, dynamic snapshot of its logistics network. The business estimates delivery times using data from various parts of the physical supply chain.
- The market performance of PharmEasy during the COVID-19 outbreak showed how adaptable its business model is. Within a few months, the COVID-19 pandemic demand surge nearly doubled the number of active customers to around three million. PharmEasy has increased its network of pharmacies to 18,587 regions or pin codes, among its other accomplishments.
In order to float an initial public offering (IPO), API Holdings, the parent company of PharmEasy, is requesting regulatory approval. It plans to offer new shares in order to raise Rs. 6,250 crores. In a second offer for sale, the corporation also intends to sell shares owned by current investors. The eligible institutional buyers will receive 75% of the IPO’s shares, leaving 10% for the retail investor group. 15% of the IPO’s shares will be allocated to other non-institutional investors.
PharmEasy IPO Financials
| Financial year | Total Assets in Millions | Total Revenue in Millions | Profit After Tax in Millions |
|---|---|---|---|
| FY 2021 | 49,053.44 | 29,809 | 6,410 |
| FY 2020 | 5,724.75 | 10,840 | 3,350 |
Know before investing
Strengths
- PharmEasy has the capability to construct an all-in-one healthcare integrated platform.
- It has the ability to develop a supply chain that is first in line with healthcare and is custom-built.
- This company has strived as a trusted partner of choice for its stakeholders.
- PharmEasy focuses more on outcome orientation than on transaction orientation for the customers.
- The firm pursues strategic acquisition and investments for brand development and capitalisation growth.
- PharmEasy strategises and constantly innovates to deliver high levels of customer experience.
- The company can expand its product portfolio, service offering, and private label with consistent funding.
Risks
- The business of PharmEasy can be hampered by changing e-commerce laws and regulations.
- Compliance requirements in the healthcare field can affect the business of this firm.
- The digital platform is totally dependent on customer engagement.
- The frailty in maintaining a proper technological infrastructure can also hamper the business growth of PharmEasy.
- The sustainability of PharmEasy depends on how the company maintains its brand image and reputation.
- The company has already incurred losses and negative cash flows, which can even follow in the future.
PharmEasy Peer Comparison
| Name of Company | Revenue |
|---|---|
| Netmeds | $ 10.2 millions |
| 1mg | $ 6.5 millions |
| Practo | $ 16.5 millions |
PharmEasy IPO FAQs:
Q1. Why is PharmEasy floating an IPO?
Ans. PharmEasy is all set to float its IPO to raise Rs. 6,250 crores to fund the existing borrowings and use the leftover funds to aid in different corporate purposes.
Q2. When will PharmEasy IPO allotment be available?
Ans. Details are not available.
Q3. Is PharmEasy generating revenue?
Ans. As per the various reports, the company has seen a growth of 220% in FY 2021. In this fiscal year, PharmEasy collected a revenue of Rs. 2,360 crores, which is massive when compared to Rs. 737.4 crores was collected in the fiscal year 2020.
Q4. What does PharmEasy do?
Ans. PharmEasy runs a healthcare e-commerce app for consumers with a wide range of facilities. Some of its significant resources include home delivery of consumer health products across various prescriptions, OTC pharmaceutical, diverse diagnostic test services, and consultation services to cater to various healthcare needs.
Q5. Is PharmEasy a startup company?
Ans. PharmEasy is a digital healthcare startup company that caters to the health needs of people. They offer services such as sample collection of diagnostic tests, teleconsultation and consumer healthcare product deliveries.
