Income Tax department raids freshly listed Mankind Pharma’s premises over alleged tax evasion

• Income tax department is conducting searches at Mankind Pharma’s premises in Delhi, checking documents, and questioning people.
• Mankind Pharma has been in the news since its stellar debut on Tuesday with 20% listing gains.
• The company is known for products like MANforce condoms, Prega News pregnancy detection kits and Gas-o-Fast sachets.

The Income Tax department on Thursday conducted searches on the premises of Mankind Pharma over allegations of tax evasion, official sources said.

A PTI report said that searches are being conducted on the company premises in Delhi and nearby locations, documents are being checked and people are being questioned as part of the action launched early this morning.

E-mail and queries sent by PTI to the company remained unanswered.

Mankind Pharma recently went public, to raise ₹4,326 crore. The initial public offer was a complete offer for sale and its promoters received the proceeds from the share sale.

Added to that, its stock listed at a 22% premium on May 9, and the company’s marketcap stands at ₹56,108 crore as of Thursday.

The pharma company also entered the top 100 companies club on its debut day.

On Thursday, it ranks at 90 in terms of largest listed companies in India, leaving behind the likes of Punjab National Bank, Hero MotoCorp, UPL, Indian Hotels and Zomato.

Analysts say that the stock may continue to do well going ahead, backed by strong fundamentals.

“Given its healthy financial track record, domestic focus and extensive network, Mankind is likely to continue doing well,” Hemang Jani, Head of Equity Strategy, Motilal Oswal Financial Services.

“Moreover the healthcare sector was a laggard over the last one year but started seeing traction over the last two months as the monthly pharma data showed improvement,” added Jani.

Macquarie Research has initiated coverage on the company with an ‘Outperform’ rating and a target price of ₹1,400. The brokerage believes that Mankind Pharma is at a discounted valuation than its peers — Abbott India, GSK India and Pfizer India.

“We believe the company’s net profit could double (>2x) in the next three years, driven by: a) continued sales outperformance relative to Indian pharma market (IPM), b) mix shift towards chronic therapies, and c) unlocking of meaningful operating leverage as salesforce productivity improves,” said the brokerage firm.

The company’s stock has been falling after the listing day amid volatile market conditions. Today, the stock is down nearly 2% at 1,356.

Incorporated in 1991, Mankind Pharma is engaged in developing, manufacturing and marketing a diverse range of pharmaceutical formulations across various acute and chronic therapeutic areas, as well as several consumer healthcare products.

Its product portfolio includes MANforce condoms, Prega News pregnancy detection kits and Gas-o-Fast sachets. The company said that it’s looking to acquire brands and diversify its therapeutic portfolio to facilitate entry into new markets.

(With inputs from PTI)

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