SYNOPSIS:
Mangalam Drugs’ shares fell after the company disclosed defaults on loans from Bank of Baroda and Bank of Maharashtra, citing reduced global disease-treatment funding and seeking loan restructuring amid weakened order flows.
During Thursday’s trading session, shares of a company involved in the manufacturing of Active Pharmaceutical Ingredients and Intermediates tumbled nearly 14 percent to hit a new 52-week low at Rs. 47.21 on the BSE, after defaulting on loans from Bank of Baroda and Bank of Maharashtra.
With a market cap of Rs. 77 crores, shares of Mangalam Drugs & Organics Limited closed in the red at Rs. 48.31 on Thursday, down by around 11.5 percent, as against its previous closing of Rs. 54.61 on BSE. The stock has delivered negative returns of around 54 percent in one year, and has fallen by nearly 31 percent in the last one month.
What’s the News
Over the past two trading sessions, the shares of Mangalam Drugs & Organics Limited have declined by more than 21 percent, a fall likely triggered by the company’s disclosure regarding loan defaults with Bank of Baroda and Bank of Maharashtra.
According to an exchange filing dated 18th November, Mangalam Drugs & Organics Limited reported that it had defaulted on its loan obligations to both banks for a period exceeding 30 days. The company stated that it had defaulted on a Rs. 4.15 crore loan from the Bank of Maharashtra, which was due for repayment before 17th October, and a Rs. 3.5 crore loan from Bank of Baroda, which was scheduled for repayment before 20th October.
The company highlighted that its business is largely dependent on funding provided to formulators for the treatment of TB, HIV, malaria, and other diseases through US Aid. The discontinuation of this funding by the US government has significantly impacted operations. Currently, only the Global Fund continues to support such treatments, but with a reduced budget. As funding has slowed, order volumes for these treatments have also dropped sharply.
Mangalam Drugs & Organics Limited further stated that it has requested a loan restructuring from its lenders and plans to submit the proposed restructuring plan by mid-December 2025. The company added that it will continue to update stakeholders on its discussions with the banks and is working toward clearing the overdue amounts at the earliest.
Financials & More
Mangalam Drugs reported a decline in revenue from operations, experiencing a year-on-year decrease of around 26 percent, from Rs. 77 crores in Q1 FY25 to Rs. 57 crores in Q1 FY26. During the same period, the company swung to a net loss of Rs. 14 crore, compared with a net profit of Rs. 3 crore in the corresponding quarter last year.
Mangalam Drugs & Organics Limited is engaged in the business of manufacturing and sale of Active Pharmaceutical Ingredients (API) for various therapeutic segments, viz. anti-malaria, anti-retroviral, anti-hypertensive, among others.
The company is actively producing Pyronoridine Tetraphosphate, a new ingredient (API) used in antimalarial Treatments. In July 2022, the company received prequalification from the World Health Organisation (WHO) for both Micronised and non-micronised forms of Pyronaridine Phosphate.
Written by Shivani Singh
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