Incorporated in 1968, Blue Jet Healthcare is a specialty pharmaceutical and healthcare ingredients maker. It offers niche products to pharmaceutical companies in three product categories, namely – contrast media intermediates, high-intensity sweeteners and pharma intermediates and active pharmaceutical ingredients (APIs).
Contrast media are agents used in medical imaging to enhance the visibility of body tissues under X-rays, computed tomography (CT), magnetic resonance imaging (MRI) or ultrasound. High-intensity sweeteners include saccharin used in table-top sweeteners, oral care products such as toothpastes and mouthwashes, beverages (primarily soft-drinks) and other confectionery products. Pharma intermediates and APIs serve as building blocks for APIs in areas of the cardiovascular system (CVS), oncology and central nervous system (CNS).
The company operates on a CDMO business model, which stands for contract development and manufacturing organisation. It also has a backward integration business model for the production of saccharin, which means that it carries out the entire process of development, manufacturing and marketing of saccharin and its salts.
It operates three manufacturing facilities in Shahad, Ambernath and Mahad in Maharashtra. As of 30 June 2023, the annual installed capacity is 200.60 KL, 607.30 KL and 213.00 KL, respectively.
As of 30 June 2023, it has served over 400 customers in 39 countries. Out of which, Europe accounted for 77.5% of its total revenue from sales, while India accounted for 12.2%. Meanwhile, contrast media intermediates contributed the highest (72%) to overall revenue. Some of its customers include GE Healthcare AS, Guerbet Group, Bracco Imaging S.p.A, Colgate Palmolive (India), Unilever, Prinova US LLC, and MMAG Co.
In the last three years, the company has seen a CAGR rise of 13% in its revenue from operations and over 5% in its profit. During the same period, EBITDA margin was in the range of 30% to 41%. Moreover, the company supplies its products to three of the four largest contrast media manufacturers in the world which make up 70% of the market. It is expected to grow at a CAGR of 6% to 8% between FY23 and FY25. It also supplies Saccharin to the dominant global players in the oral care and non-alcoholic beverages market. All of which could be beneficial for the company.
And now, Blue Jet Healthcare Limited is coming out with its initial public offer (IPO). The entire IPO will be an offer for sale and all the offer proceeds will be received by its selling shareholders. Its shares will be listed on the NSE and the BSE.
- A specialty pharmaceutical, and healthcare ingredients maker, offering its products under three categories - contrast media intermediates, high-intensity sweeteners and pharma intermediates and active pharmaceutical ingredients (APIs).
- Contrast media are agents used in medical imaging to enhance the visibility of body tissues under X-rays etc.
- Saccharin is used in table-top sweeteners, oral care products, beverages, confectionary products.
- Blue Jet Healthcare has served more than 400 customers in 39 countries as of 30 June 2023. Europe accounted for 77.5% of its total revenue from sales, while India accounted for 12.1%.
- CAGR rise of over 13% in its revenue from operations and over 5% in its profit in the last three years.
- Operates three manufacturing facilities in Shahad, Ambernath and Mahad in Maharashtra.
- Customers include GE Healthcare AS, Guerbet Group, Bracco Imaging S.p.A, Colgate Palmolive (India), Unilever, Prinova US LLC, and MMAG Co.
- Large manufacturer of contrast media intermediates in India with an experience of more than two decades.
- Presence in niche categories with high barriers to entry because of strict internal standards of contrast media manufacturers and the relationships between them and their existing suppliers, typically supported by long-term supply contracts.
- Long-term customer relationships ranging from four to 24 years in the contrast media intermediate category, and three to 14 years in the high-intensity sweetener category.
- Strong R&D capabilities approved by the Department of Scientific and Industrial Research (DSIR) in 2018.
- Manufacturing facilities with regulatory accreditations, one of which has been subjected to US-FDA inspections in FY18.
Risks and threats
- Dependent on revenue from its five largest customers which accounted for over 74% of its total income from operations in FY23.
- Dependent on the limited number of clients for its raw material supply. China, Norway and India are the most prominent suppliers. Hence, delays or interruptions in these countries could lead to shortages of raw material.
- Exposed to counterparty credit risk with gross trade receivables of ₹239 crore as of 31 March 2023.
- Derives significant revenue from Europe and India, accounting for 74% and 13% of the total income from sales in FY23.
- Faces forex risks as exports to regions outside India accounted for 84%, 82%, and 85% of its total revenue from operations in FY21, FY22 and FY23 respectively.
- Operates a capital intensive business with significant working capital requirements.
You can apply for the Blue Jet Healthcare IPO on Upstox here: Blue Jet Healthcare IPO - Details: Blue Jet Healthcare IPO date, Share Price, Lot Size, Allotment Status.