Alembic Pharma plans greenfield projects to feed global market

Profit flat at ₹120 crore in Q2

Ahmedabad, November 7



Vadodara-based Alembic Pharmaceuticals Ltd has set out plans for major expansion to feed its international markets in the areas of dermatology, oncology solids and injectibles, ophthalmics and general injectibles.

The company has laid down investment plans of ₹600 crore for the fiscal 2017-18, out of which it has invested ₹300 crore for setting up greenfield projects.

"We are investing to create new capabilities that will cater to our international market. We are entering into the injectibles space, dermatology, oncology for the international markets. In the first half, we have invested about ₹300 crore for setting up facilities, and similar investment will happen in the second-half," Pranav Amin, Managing Director, Alembic Pharmaceuticals, told BusinessLine.

Amin added that the company is comfortable to fund the expansions as it has debt-to-equity ratio of about 0.11 per cent with ₹200 crore as debt. The new facilities will exclusively cater to the company's international market, 70 per cent of which is the US business.

While the dermatology facility is at the final stage of completion, the oral-oncology facility is completed and the remaining injectibles facilities will be completed in the coming months.

On Tuesday, company announced its financial results for the second quarter with profit being almost flat at ₹120 crore for the quarter ended September 2017 against ₹119 crore in the corresponding quarter last year.

Total revenues dipped by about 10 per cent to ₹789 crore for the quarter against ₹879 crore in the same period last year.

Amin attributed the dip in revenues to the fall in the revenues from the international markets, which fell by about 26 per cent to ₹262 crore.

“Our India business is recovering from the de-stocking that had happened at the time of implementation of GST.

“But the business has grown by about 6 per cent to ₹385 crore as against the second quarter last year. The de-growth has come in the international market, mostly in the US on price pressure," said Amin.

For the first half period (April-September), the company's profits slipped by 16 per cent to ₹186 crore against ₹221 crore in the same period last year on the revenues of ₹1,431 crore, which too fell by 11 per cent from ₹1,616 crore for the first-half last year.

Published on November 07, 2017

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