Molbio Diagnostics raises $85 mn from Temasek at unicorn valuation

Singapore-based investment firm Temasek has invested $85 million (around ₹680 crore) in Goa-based diagnostics chain, Molbio Diagnostics Pvt. Ltd. The company will be valued at $1.6 billion post the round, said a person aware of the development.

Molbio Diagnostics, known for its molecular diagnostic testing platform, will be the 108th unicorn after Tata 1mg made it to the list earlier this month. 

The latest fundraising is a combination of primary and secondary market transactions with partial exits by angel investors. 

According to a statement, Molbio will utilize the funds to expand its global network. Currently, the diagnostics chain operator has a presence in over 40 countries and it plans to further add 20-25 countries every year, Sriram Natarajan, chief executive officer and diagnostics director, Molbio said in an interaction with VCCircle. 

“In terms of inorganic growth, we are looking at a few options to acquire assets in addition to our R&D. We plan to close an acquisition soon,“ he added.  

“The demand for high-quality, point-of-care molecular diagnostic systems is higher than ever today. The strategic partnership with Temasek will strengthen our ability to provide sustainable choices to address global healthcare challenges,” said Natarajan. 

The company employs 750 people with 400 in manufacturing, 200 in sales and the rest in operations and others, he noted.

The company is also backed by Motilal Oswal Private Equity (MOPE), a subsidiary of Motilal Oswal Financial Services Ltd, which invested up to ₹240 crore (around $32.5 million) in 2020. Molbio offers PCR (polymerase chain reaction) tests for infectious diseases and received prominence during Covid. 

Founded in 2000, Molbio and subsidiary Bigtec Labs develop and commercialize Truenat, a platform that uses PCR technology to detect at least 22 infectious diseases including tuberculosis, swine flu, dengue and HIV. According to the firm, the platform can deliver results within 60 minutes at an economical price point. 

The diagnostics firm’s financial results were propelled significantly through FY21 by the Covid-19-related testing frenzy. 

Molbio clocked a revenue of ₹1,272 crore in the fiscal year ending March 2021 against ₹51.5 crore in FY20, as per regulatory filings, a jump of nearly 25 times. 

The person cited above said the company this year will clock around ₹850 crore in FY22 as the demand for COVID-19 testing has waned after FY21.  

The company reported a profit of ₹472.7 crore in FY21 compared to a loss of ₹16.27 crore in FY20, filings showed. Molbio is yet to file its annual filings for FY22.  

Rohit Mantri, Director at Motilal Oswal Alternates added, “Over the past three years, Molbio has changed the diagnostic paradigm across India and has had a real impact in saving millions of lives.“ 

Allegro Capital was the exclusive adviser for this transaction. 

In July, Temasek Holdings said its exposure to India had climbed to a record $16 billion in the last financial year despite a broader market correction as the Singapore state investor continued to augment its investments in technology firms and listed companies. Its India exposure grew to $14 billion in FY21 from $9 billion in FY20. The figure stood at $11 billion in FY19, $10 billion in FY18 and $9 billion in FY17.