Curis Lifescience NSE SME IPO review

•    The company is engaged in manufacturing pharma products on contract/loan license basis.
•    It posted growth in its top and bottom lines for the reported periods. 
•    Boosted profits from FY24 onwards raise eyebrows and concern over its sustainability as it is operating in a highly competitive and fragmented segment.
•    Based on its recent financial data, the issue appears fully priced. 
•    Only well-informed/cash surplus investors may park moderate funds for medium term.

ABOUT COMPANY:
Curis Lifesciences Ltd. (CLL) is the pharma manufacturer, specializing in manufacturing of a wide range of pharmaceutical products such as Tablets, Capsules, External Preparations, Oral Liquid, Sterile Ophthalmic Ointments. It is in business of manufacturing of pharmaceutical products. The company carries out manufacturing under Loan License arrangement, where all raw materials and excipients are procured and delivered by the client. Further the client provides us with necessary supporting documents and formulations. On instructions of the client, it undertakes manufacturing activities under observation of a chemist, representing the customer. In summary, our company would perform manufacturing activities as a job work on behalf of the loan licensing company for the product. Its customers for loan license manufacturing activities are domestic.

The company carries out manufacturing under Contract Manufacturing arrangement, where the Company would be responsible for procuring and handling all ingredients, raw materials, and packaging materials. Further, all necessary supporting documents and formulations required under manufacturing process would be procured / provided by the company. However, the client, is responsible for providing the brand name and product composition. Moreover, all marketing and distribution responsibilities rests with the client. As on the date of this Red Herring Prospectus, its manufacturing facility is installed with capacity to manufacture 138 crore tablets / year, 15.75 crore capsules / year, 1080 Kilolitre Oral Liquid/ year, 270 Tons external preparation / year and 45 Tons sterile ophthalmic ointment / year. As of July 31, 2025, it had 95 employees on its payroll.

ISSUE DETAILS/CAPITAL HISTORY:
The company is coming out with its maiden book building route IPO of 2150000 equity shares of Rs. 10 each to mobilize Rs. 27.52 cr. at the upper cap. It has announced a price band of Rs. 120 – Rs. 128 per share. The issue opens for subscription on November 07, 2025, and will close on November 11, 2025. The minimum number of shares to be applied is for 2000 shares and in multiples of 1000 shares thereon, thereafter. Post allotment, shares will be listed on NSE SME Emerge. The issue constitutes 26.59% of the post-IPO paid-up capital of the company. From the net proceeds of the IPO, the company will utilize Rs. 11.25 cr. for working capital, Rs. 2.44 cr. for capex on upgradation/improvement of existing manufacturing facilities, Rs. 3.62 cr. capex on construction of a storage facility, Rs. 1.86 cr. for repayment/prepayment of secured loans, Rs. 2.69 cr. for product registrations in other countries, and the rest for general corporate purposes. 

The IPO is solely lead managed by Finaax Capital Advisors Pvt. Ltd., and MUFG Intime India Pvt. Ltd., is the registrar to the issue. RS Wealth Management Pvt. Ltd., is the Market Maker for the company. Swastika Investmart Ltd. is a syndicate member. The issue is underwritten to the tune of 15% by Finaax Capital Advisors, and 85% by Sixth Sense Securities Pvt. Ltd.

Having issued initial equity shares at par value, the company issued further equity shares at a fixed price of Rs. 1076 per share in October 2024. It has also issued bonus shares in the ratio of 10 for 1 in December 2024. The average cost of acquisition of shares by the promoters is Rs. 0.85, and Rs. 0.91 per share. 

Post-IPO, company’s current paid-up equity capital of Rs. 5.93 cr. will stand enhanced to Rs. 8.08 cr. Based on the upper price band of the IPO, the company is looking for a market cap of Rs. 103.48 cr. 

FINANCIAL PERFORMANCE:
On the financial performance front, for the last three fiscals, the company has posted a total income/net profit of Rs. 36.42 cr. / Rs. 1.88 cr. (FY23), Rs. 35.87 cr. / Rs. 4.87 cr. (FY24), and Rs. 49.65 cr. / Rs. 6.11 cr. (FY25). For 4M of FY26 ended on July 31, 2025, it earned a net profit of Rs. 2.87 cr. on a total income of Rs. 19.51 cr. 

For the last three fiscals, the company has reported an average EPS of Rs. 8.43 and an average RoNW of 77.51%. The issue is priced at a P/BV of 3.98 based on its NAV of Rs. 32.18 as of July 31, 2025, but its post-IPO NAV data is missing from offer documents.

If we attribute FY26 annualized earnings on post-IPO fully diluted equity capital, then the asking price is at a P/E of 12.01. Based on FY25 earnings, the P/E stands at 16.95. The issue relatively appears fully priced.

For the reported periods, the company has posted PAT margins of 5.29% (FY23), 13.69% (FY24), 12.43%, (FY25), 14.72% (4M-FY26), and RoCE margins of 14.83%, 33.57%, 27.83%, 11.65%, respectively for the referred periods. 

DIVIDEND POLICY:
The company has not paid any dividends for the reported periods of the offer document. It will adopt a prudent dividend policy post listing, based on its financial performance and future prospects. 

COMPARISION WITH LISTED PEERS:
As per the offer document, the company has shown Sotac Pharma, Lincoln Pharma as its listed peers. They are currently trading at a P/E of 18.6, and 12.2 (as of November 04, 2025). They are not truly comparable on an apple-to-apple basis. Such comparison is nothing, but an eyewash. 

MERCHANT BANKER’S TRACK RECORD:
This is the 1st mandate from Finaax Capital in the ongoing fiscal.  Thus, it has no track records for any mandates so far.