Zydus Lifesciences raises Rs 5,000 cr through equity. 38% increase in second quarter profits
The company said in a notice to the stock exchange that the fund raising may be executed in one or more tranches through public or private share sale to institutional investors, rights issue, preferential allotment or a combination of these routes.
The proposed capital injection is expected to support Zydus’ continued R&D investments, international market expansion and future specialty segment launches.
“The key objective is to reduce the balance sheet by reducing existing debt. There are also strategic moves to strengthen our financial strength and agility to strengthen our capital structure position for future growth,” Managing Director Sharvil Patel said in an investor call.
“More importantly, there is also an opportunity for us to look at our U.S. specialty business and expand beyond Saroglitazar,” he said. “There are also opportunities in international markets, particularly in Europe, and more innovative assets that we are looking at. So this will give us the ability to execute on some of those.”
On the potential deal size, he said there are currently no viable deals, but the focus is on specialty businesses and the US market as well as specific brands in India if opportunities or adjacent geographies exist. The company on Thursday reported second-quarter net profit of ₹125.86 billion, up 38% year-on-year, while revenue from operations rose 17% to ₹612.32 billion. Ebitda rose 38 per cent to Rs 2,015.80 crore and margins rose 5 percentage points to 32.9 per cent.
Patel attributed this performance to “the outstanding performance of our U.S. and India formulations businesses, continued strong growth in international markets, and strategic acquisitions in the wellness and medical technology space.”
Zydus also reported positive Phase 3 results for saroglitazar magnesium for the treatment of primary biliary cholangitis in the U.S. market.
