New Delhi, June 25 -- Bain Capital has sold its entire remaining stake in an Indian healthcare portfolio company, marking the culmination of the bulge-bracket private equity firm's 12-year-long investment holding period.
The PE firm, which last month hit the final close of its new Asia fund after collecting $10.5 billion, sold its remaining 1.26% stake in Pune-based drugmaker Emcure Pharmaceuticals Ltd via a secondary market deal, according to stock-exchange data on Thursday. It pocketed Rs 352.4 crore ($37.3 million) from the exit.
Earlier this month, the Boston, Massachusetts-headquartered PE firm pared its stake in Emcure by selling shares worth Rs 612 crore. The PE firm had sold another chunk of shares in Emcure via a secondary market transaction at the end of April, harvesting Rs 290 crore ($30 million at the time).
Late last year, Bain pocketed Rs 610 crore by selling over a third of its remaining 6.3% holding. A year before, it pulled out Rs 563 crore. Prior to that, in 2024, it divested some stake via the company's initial public offering. Bain had offloaded a little under a third of its 13% stake in Emcure through the IPO for Rs 730 crore.
While it had managed a 3.6x multiple of invested capital in the public issue, it spun 4.5x in the tranche a year ago and pulled out 4.8x in the partial exit last winter. In April's transaction, it generated an MOIC of 5.8x as Emcure's share price rallied over the last one year.
Emcure's shares have risen more than 41% in the last 12 months, closing at Rs 1,880.2 per share on Thursday. This has helped Bain realize a 6.5x multiple on invested capital in the latest tranche, VCCircle estimates showed.
Bain Capital invested Rs 656 crore in 2013-14 to acquire a minority stake in the drugmaker through a secondary PE deal, acquiring the stake from Blackstone.
To date, Bain's exit from Emcure has generated around Rs 3,156 crore, or around $355 million at the exchange rates prevailing at the time of the share sales.
Back-of-the-envelope calculations show that, with the latest transaction on Thursday, Bain Capital likely generated an overall IRR of around 14% in rupee terms. This is below the 20% annualised return that PE funds typically seek in local currency. In dollar terms, the IRR would be around 10-11% due to the rupee's depreciation and missing the 15% benchmark, VCCircle estimates show.
Bain has lined up another exit move with the initial public offering of Dhoot Transmission Ltd and settled for a lower stake in the Mumbai-listed Manapuram Finance after the PE firm's open offer failed.
Meanwhile, Emcure has managed to nearly triple both its revenue and net profit in the last decade. It has recovered much of its growth momentum in the last three years even though its earnings profile had shown some inconsistency. Previously, its financial performance was patchy during FY16 and FY19, in particular.
Emcure had sought to go public way back in 2013. At that time, Blackstone was on the cap table and had offered to sell some shares. But this plan was shelved and Blackstone chose to exit via a secondary deal with Bain. Blackstone itself is believed to have exited with an IRR of less than 20% in that transaction.
Emcure's product portfolio includes orals, injectables and biotherapeutics, which has enabled it to reach a wide range of target markets across over 70 countries, with a strong presence in India, Europe and Canada. It is ranked among the top 15 pharmaceutical companies in India in terms of domestic sales and is the largest in the gynecology and human immunodeficiency virus (HIV) antiviral therapeutic areas in India. Its domestic sales bring nearly half of its total revenue.
Published by HT Digital Content Services with permission from VC Circle.