During Friday’s trading session, the shares of India’s largest Contract Development and Manufacturing Organization (CDMO) surged 2.2 percent to Rs. 935 on BSE, after entering into an MoU with the Government of Republic of Zambia through the Ministry of Health.
With a market cap of Rs. 14,322.8 crores, the shares of Akums Drugs and Pharmaceuticals Limited opened at Rs. 896, compared to its previous closing price of Rs. 914.75.
What’s the news:
Akums Drugs and Pharmaceuticals Limited has signed a Memorandum of Understanding (MoU) with the Government of Republic of Zambia, through the Ministry of Health, located at Ndeke House, Haile Selassie Road, Lusaka.
According to the latest regulatory filings with the stock exchanges, the agreement is signed for local manufacturing of medicines, recognising the existing collaboration between the Zambian Government & Akums in the field of medicines and medical supplies, and strengthening the collaboration between the two entities.
Previous News:
On 12th September, the Patent Office of the Government of India granted a Patent Certificate to Akums Drugs for its invention titled “Room Stable Hydroxyurea Oral Suspension,” which is valid for a term of 20 years. This patent represents a breakthrough formulation designed for the management of Sickle Cell Disease (SCD).
On 16th October, the company entered into a License and Distribution Agreement with Triple Hair Inc., Canada.
According to the terms of the agreement, Akums Drugs has been granted exclusive rights to further develop and market the products recently innovated by Triple Hair Inc. within the territory of India.
Additionally, Akums Drugs will manage the commercial strategy to promote and offer Triple Hair’s patented products to its own marketing partners and clients exclusively within the Indian market.
Financials:
The company experienced a marginal growth in its revenue from operations, showing a year-on-year increase of around 5 percent from Rs.
970 crores in Q1 FY24 to Rs. 1,019 crores in Q1 FY25.
Similarly, its net profit increased during the same period from a loss of Rs. 187 crores to a profit of Rs. 61 crores.
In Q1 FY25, the company’s CDMO segment, which represents 77 percent of total revenue and 93 percent of adjusted EBITDA, grew to Rs. 782 crores, reflecting a year-on-year increase of 5.6 percent. This growth was fueled by a strong sales volume increase of 13.9 percent.
Additionally, segment EBITDA experienced a margin expansion of 106 basis points to 15.5 percent, rising 13.4 percent year-on-year to Rs. 121.2 crores, supported by steady improvements in capacity utilization and an enhanced product mix.
Akums Drugs’ debt-to-equity ratio improved to 0.25 times, with net debt reducing by over Rs. 200 crores from Rs. 418 crores in Q1 FY24 to Rs. 212.8 crores in Q1 FY25.
As of Q1 FY25, Akums Drugs has a manufacturing capacity of 49.59 billion units annually spread across more than 60 dosage forms.
Future Plans:
Akums Drugs plans to set up greenfield manufacturing units in the Union Territory of Jammu and Kashmir, comprising two facilities: one multi-dosage unit focused on pharmaceuticals and another dedicated to nutraceuticals.
The company proposes to invest a total of Rs. 265 crores for both facilities, which will be financed through bank loans and internal accruals.
About the company:
Established in 2004, Akums Drugs and Pharmaceuticals Limited is the largest India-focused CDMO with a market share of over 30 percent in the domestic CDMO market.
The company offers a wide range of advanced services, including formulation development, bioequivalence studies, clinical trials, and securing Drug Controller General of India (DCGI) approvals for manufacturing and marketing new Fixed Dose Combinations (FDCs) and molecules.
In addition to the CDMO Business, Akums Drugs is also engaged in the manufacturing and sale of branded formulations, trade generics and APIs across domestic and overseas markets.
Written by Shivani Singh
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
