Kolkata-based life-sciences company Tarsons Products, which had reported 30 per cent growth in sales in FY21 on the back of Covid-related demand, is looking to almost double its production capacity in the next two years.

The company, which has five units in West Bengal, is developing its sixth facility at Panchla, also in the State. The unit, which is spread across 21,550 sq mt, is likely to entail a total investment of ₹200 crore, sources said.

According to Rohan Sehgal, whole-time director, Tarsons Products, the capacity and area of the Panchla facility would be approximately equal to the combined capacity and area of the other five facilities and effectively double its output.

The company recently filed the draft red herring prospectus (DRHP) with SEBI for its proposed initial public offering. According to market sources, it hopes to raise close to ₹1,500 crore comprising a fresh issue of ₹150 crore and 1.32 crore equity shares as offer for sale.

The Panchla facility would be funded partly through internal accruals and partly through proceeds of the IPO.

Growing demand

Tarsons is engaged in design, development, manufacturing and marketing of laboratory products including consumables, which account for over 60 per cent of its business; re-usables (34 per cent) and benchtop equipmentthe balance.

Its clients include Dr Reddy’s Labs, Syngene, Dr Lal Path Labs and Metropolis.

“We plan to enhance production capacity in existing products such as micro pipette tips, cryo vials and launch new products including PCR plates, deep well plates, screw cap tubes, volumetric flasks and thus provide a platform for the growth of the business,” Sehgal told BusinessLine . As of 2020, the plastic labware market in India is estimated at₹1,225 crore. It is growing at 16 per cent CAGR to reach approximately ₹2,575 crore by 2025, according to a Frost & Sullivan report.

Export growth

The company, which supplies products to over 40 countries, is expecting a good traction in demand moving forward.

“Domestic market currently accounts for nearly two-thirds of our total sales and the balance from overseas. Moving forward also the mix (domestic to international) will remain at similar levels backed by a steady growth in both segments,” he said.

As of FY21, the company recorded 30 per cent growth in revenues from sale of products at ₹228 crore compared to ₹175 crore in FY20.

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