World Bank Group's International Finance Corporation has returned as an anchor investor in India's mainboard IPO market after a gap of five years, investing Rs 20 crore in IPO-bound Molbio Diagnostics. The Goa-based point-of-care diagnostics company raised Rs 281 crore from anchor investors on Friday ahead of its public issue, which opens for subscription on August 10 and closes on August 12.

IFC, the private-sector investment arm of the World Bank Group, last participated as an anchor investor in an Indian IPO in June 2021, when it invested Rs 10 crore in Dodla Dairy. According to news reports, IFC stayed invested in Dodla Dairy for three years until 2024.

HDFC Mutual Fund led the anchor book with a Rs 35 crore investment across four schemes: HDFC Pharma and Healthcare Fund, HDFC Value Fund, HDFC Innovation Fund, and HDFC MNC Fund.

Ahead of the IPO, Molbio also undertook a secondary sale at Rs 807 per share, which is the upper end of the IPO price band.

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According to a public announcement issued on August 7, several alternative investment funds and institutional investors picked up shares worth Rs 160 crore through secondary transactions.

Kotak Mahindra Life Insurance Company and Susquehanna Asia Technology Pty Ltd also participated in the secondary purchase.

The pre-IPO secondary deal points to strong institutional interest in Molbio ahead of its listing.

Molbio's Rs 940 crore IPO has received positive recommendations from several brokerages. BP Wealth, Swastika Investmart, and Ventura Securities have given the issue a Subscribe rating, while SBI Securities has recommended Subscribe for Long Term.

SBI Securities said Molbio showed healthy financial performance between FY24 and FY26, with revenue, EBITDA, and adjusted profit after tax growing at a compound annual growth rate of 31.5%, 17.2%, and 9.7%, respectively.

The brokerage said the IPO valuation, at FY26 price-to-earnings of 56.5 times and EV/EBITDA of 28.5 times, appeared reasonable compared with the company's growth profile, profitability, return ratios, and position in the diagnostics ecosystem.

It said future growth would be driven by assay expansion, rising adoption of molecular diagnostics, international market penetration, and investments in research, development, and manufacturing.

Swastika Investmart said Molbio's valuations are in line with the industry average and below the listed peer average P/E of 64.9 times. It also noted that the Rs 200 crore fresh issue proceeds are meant for growth capital expenditure rather than debt reduction.

IPO opens on August 10

Molbio Diagnostics' IPO will open on Monday, August 10, and close on Wednesday, August 12. The company plans to use Rs 106 crore from the fresh issue proceeds to fund capital expenditure for setting up infrastructure for an R&D facility, Centre of Excellence, and connected office space.

It will use another Rs 72 crore to buy plant, machinery, and equipment for Goa Unit I, Goa Unit II, and its Visakhapatnam unit. The remaining proceeds will be used for general corporate purposes.