The Biotech Lab You’ve Never Heard Of, But Everyone Wants a Piece Of

Anthem Biosciences IPO: Growth, Margins, and What Investors Need to Know

Anthem Biosciences is heading to Dalal Street. Here’s what retail investors should know before the CRDMO quiet giant lists.

What exactly does Anthem Biosciences do?

Most of us hear the word “pharma” and think of Cipla, Sun, or maybe a branded tablet with ₹70 MRP. But Anthem isn’t in the business of medicines you buy, it’s in the business of molecules that help make those medicines possible.

Anthem Biosciences is a Contract Research, Development, and Manufacturing Organization (CRDMO). It helps large pharmaceutical, biotech, and specialty chemical companies develop molecules from scratch, optimize the process, and then scale up manufacturing, all without ever launching its own product.

If that sounds niche, it is. But it’s also global, sticky, and lucrative.

Headquartered in Bangalore, Anthem employs nearly 4,900 people, including 1,500+ scientists, and operates four manufacturing facilities plus one R&D center. It has delivered over 8,400 projects, supported 11 major global pharma firms, and contributed to 10 successful molecule launches. These aren’t small wins, they’re evidence of Anthem’s place in the scientific supply chain of global healthcare.

This isn’t “Make in India” in the traditional sense. It’s “Discover in India, Deliver to the World.”

So why is it going public?

Here’s the interesting twist: it’s not raising money to fund its growth.

The ₹2,800 crore IPO is a full-fledged Offer for Sale (OFS). This means all proceeds go to existing shareholders — specifically, Carlyle (a global PE fund) and Dr. S. Manjunath (promoter). Anthem, the company, won’t receive a single rupee.

Still, there’s good reason to pay attention.

Because even while the owners are selling, the business is scaling. Anthem has commissioned two new facilities T-5 and T-6 to build capabilities in biologics and high-potency APIs. It’s also doubling its fermentation capacity from 92 kL to 182 kL by FY26, which is no small feat.

So yes, this is an exit for the old guard. But the lab itself is still under expansion.

What do the numbers say?

Let’s start with the company’s core financials.

• Revenue grew from ₹1,134 crore in FY23 to ₹1,930 crore in FY25, a 36% CAGR.
• EBITDA moved from ₹446 crore to ₹684 crore over the same period.
• PAT grew from ₹385 crore to ₹451 crore, though FY24 saw a temporary decline due to higher input costs and capacity building.

This isn’t just top-line growth, it’s happening with strong capital discipline.

The company operates in two primary verticals:

• CRDMO: 81.65% of FY25 revenue
• Specialty Ingredients: 18.35%

The CRDMO segment offers predictable, repeatable cash flows with high client stickiness. Specialty Ingredients, on the other hand, caters to cosmeceuticals, animal health, and nutrition, it’s higher margin but a smaller contributor for now.

How profitable is this business?

Extremely. Anthem is among the few Indian players that checks all four profitability boxes: margin, return ratios, asset-light expansion, and low debt.

Here are the FY25 metrics:

• EBITDA margin: 36.81%
• PAT margin: 23.38%
• Return on Equity (ROE): 20.82%
• Return on Capital Employed (ROCE): 26.88%
• Debt-to-equity: just 0.05

These aren’t just good numbers. They’re top-decile metrics, even when compared to listed CRAMS players (Contract Research and Manufacturing Services) like Syngene or Suven Pharma. Anthem also boasts a ₹2,807 crore asset base and a growing reserve pool, signaling strength on the balance sheet.

Its R&D-first model enables better pricing power, lower churn, and higher realization per project. This is what makes Anthem attractive, not just its growth, but its quality of earnings.

So what’s the catch?

Every great story has a footnote. Anthem has a few.

First, and most importantly, there’s a client concentration risk. More than 70% of revenue comes from the top five clients, and one of them which is DavosPharma alone accounts for 14.3%. That’s a lot of dependence on a handful of partners. If even one shifts business, revenue can swing sharply.

Second, Anthem’s plants are subject to audits by global regulatory agencies (USFDA, WHO, etc.). That comes with significant compliance risk. One negative inspection or delay can impact batch shipments and, in turn, client trust.

Third, this is a pure OFS. No new capital is being infused into the business. Existing shareholders are reducing stake and that’s something every retail investor should keep in mind.

Finally, the valuation is steep. Pre-IPO, Anthem’s P/E ratio stands at ~70.6x based on FY25 projected EPS of ₹8.07. This is on par with high-growth innovators, but Anthem is still an India-based backend services firm, not a patent-led global pharma major.

To justify these multiples, execution must remain flawless.

Should retail investors even care?

Yes and not just because it’s trending on IPO platforms.

Anthem is not a hype-based, loss-making consumer-tech story. It’s a real business with real earnings, real margin, and real IP value. It operates at the intersection of science, outsourcing, and global supply chains, three themes that will only grow stronger over the next decade.

That doesn’t mean everyone should buy it on Day 1. But it does mean it deserves a place in your investment watchlist.

If you’re a long-term investor with a lens on capital-efficient businesses, especially those involved in R&D, biotech, and specialty manufacturing, Anthem could be a core candidate once post-listing volatility settles.

What’s the verdict?

Anthem Biosciences is a high-margin, high-R&D, low-visibility gem entering public markets.

Its CRDMO-led business is backed by:

• Global relationships
• Low client churn
• World-class labs and scientists
• Steady expansion in fermentation and high-potency APIs

The risks are real. Customer concentration, regulatory dependency, and zero fresh capital, but the quality of business remains rare in the Indian IPO landscape.

Anthem isn’t selling you a pill. It’s building the lab that makes it. And for the right kind of investor, that’s a bet worth studying.

At Shikshan Nivesh, we believe investing should start with understanding and every story we write is built to reflect that.

Written by Shubham Borkar | Research & Insights by Shikshan Nivesh

Financial Clarity. Insightful Ideas.

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Disclaimer: This article is published as part of the Shikshan Nivesh educational initiative. The content is intended solely for informational and discussion purposes and should not be construed as investment, legal, financial, or professional advice. The views expressed do not represent any formal recommendation or judgment regarding any individual, company, or institution. Readers are encouraged to conduct their own research and consult qualified professionals before making any investment or business decisions.

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