04 May 2024
Analyzing the Dip: Understanding PharmEasy's Valuation Decline
Pharmeasy has secured funds worth US$1.8 Billion across 17 rounds. Its first round of funding worth US$ 17 million was conducted in its debut year 2015.
PharmEasy has a total debt of $300 million (Rs. 2,280 crs) from Goldman Sachs which it took in 2022, part of which is due for payment soon. To repay the debt, the company has launched a rights issue in 2023 worth ₹3,500 Crores with the aim of repaying its debt obligations.
Recently, the company has raised another ₹1,804 crores ($216 million) in a round led by Ranjan Pai’s Manipal Education and Medical Group (MEMG). Other investors who participated in the round include CDPQ Private Equity, WSSS Investments, Evolution Debt Capital, and Goldman Sachs. The company plans to convert the cumulative convertible preference shares (CCPS) issued into equity shares at a ratio of 1:20, which makes the price oper shares ~Rs. 5 as per the filings.
Following the allotment, API Holdings is estimated to be valued at around Rs 5,904 crore or $710 million, according to TheKredible's estimates. This marks a significant 90% reduction in PharmEasy's valuation, which was valued at $5.6 billion in 2021.
It is to be noted that Pharmeasy has been trying to expand its market presence globally with primary targets being North America & Africa for which it has been constantly trying to drive the expansion through a mixture of debt & equity.