What IPO papers reveal about PharmEasy’s complex structure

The online healthcare platform’s public offering will be a test case for eager-to-list ecommerce companies with FDI. While back-to-back acquisitions have helped it increase revenues, can the sum of its parts deliver rapid topline growth with better margins?

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By 

Madhav Chanchani

December 10, 2021

12 Min Read

Heard of Axelia Solutions or Aarman Solutions? They may not ring a bell, but they are vital to the business of PharmEasy, India’s leading online pharmacy and healthcare platform. 

The two companies operate the platform, including the mobile app and website. PharmEasy’s well-known parent, API Holdings Limited, does not perform this function. 

Confused? That’s the complex structure of API Holdings, which filed papers for a Rs 6,250-crore IPO last month, becoming the youngest Indian unicorn to make the public-market move.

API has over two dozen subsidiaries, thanks to a string of acquisitions it has made to build out the business in a heavily regulated market. Aarman and Axelia, however, do not figure among the subsidiaries. API has a shade below 20% stake in Aarman, which owns Axelia. 

PharmEasy is run in this complicated manner because it has to comply with the wide-ranging rules governing foreign direct investment. India does not allow FDI in inventory-based models; outside money is permitted in only marketplace models.

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