The Downturn in PharmEasy’s Valuation: Surfacing the Struggles and Survival
PharmEasy, an Indian online pharmacy brand has occupied the news headlines these days. The reason behind its constant popping up in the news is a massive drop of 92% in its valuation. Janus Henderson, one of its investors, has revealed the collapse from $5.6 billion to the current valuation of $456 million.
The Digits Behind the Plummet
The Global Research Fund owes 12.9 million shares in PharmEasy, retaining a value of $766,043 according to late September 2024. This demonstrates a spontaneous fall from the $9.4 million of the previously invested fund.
Efforts to Re-establish the Reputation
Despite financial daunting conditions, PharmEasy has been burning the midnight oil to regain its reputation. As a matter of reward, the company boosted around $200 million at the beginning of 2024. On top of it, the team has scheduled to launch an Initial Public Offering ( IPO) in the upcoming year. Looking at its growth plot, it is undeniable that PharmEasy battled with financial setbacks. Moreover, the massive loan of $300 million from Goldman Sachs strongly tested the endeavour and endurance of the struggling name.
Back in 2023, the pharmacy brand showed up in the market ‘rights issues’. It is a strategy that enables stakeholders to invest in the discounted shares. This tactic worked well and rocketed the value up to $417 million. It pretty much functioned as a blessing in disguise for PharmEasy. However,the strategy dragged along the risks and challenges of shareholder dilution.
Battling with the Bitter Reality
PharmEasy’s consistent efforts managed to elevate its funding up to $1 billion since its commencement. Despite accomplishing “Thyrocare” for $600 million in the year 2021, PharmEasy doesn't seem to have a slick golden future. Its financial distress has been attributed to the decision to delay an $ 843 million IPO in 2021. This spontaneous move turned out to be inimical, compelling the brand to work on debt financing.
An evaluation Into the future
The Pharmacy brand has garnered consistent support from global heavyweights. It significantly includes Prosus, Temasek, TPG and B capital. Although PharmEasy has been standing as one of the leading Pharmacies in India, its future with a lowered valuation appears to be imbalanced and unfortunate. Its IPO, scheduled in 2025, will prove to be a deciding element in the company's prosperity and future reputation.
Let's see how PharmEasy leads through the path of depth towards well-settled financial standards.
