Granules India Will ‘Easily Beat’ Its Q1 Performance Going Forward, Says MD
“We are moving there where margins are definitely higher,” the chairman & MD said.
Granules India Ltd. is confident of beating its first quarter performance for the remainder of the ongoing financial year as it transitions towards higher earnings products.
The drugmaker’s revenue rose 24% year-on-year to Rs 736 crore in the quarter-ended June while profit rose 34% to Rs 111 crore. Its operational margin expanded to 25% from 19.9% from a year ago. “We’ll easily beat that going ahead,” Krishna Prasad Chigurupati, the company’s chairman and managing director, told BloombergQuint.
Granules is focusing on large volume molecules which has a lifespan of many years if not decades, he said in an interview. It has already increased its large volume molecules from the five it used to manufacture previously and is adding around two such molecules to its portfolio every year, “which is a lot”, he said.
The pharma company is also shifting focus towards molecules which have higher value, where manufacturing is driven by complexity. “So we’re moving where margins are definitely higher.”
Pharmaceuticals is one of the few industries in India that has gained business amid the Covid-19 pandemic, as Indian companies work to fulfill global demand for drugs. Despite the disruptions caused by the lockdown, Granules India’s previous capex investments are now paying off, Chigurupati said. The company will invest Rs 400 crore in the current financial year and possible another Rs 200 crore in the next, all from internal accruals, he said.
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