The shares of one of the leading pharmaceutical companies, specialising in the production of active pharmaceutical ingredients (APIs) and intermediates, jumped up to 5 percent following the approval of two capital expenditure projects worth Rs. 342 crores.
Price action
With a market capitalization of 16,930 Crores on Wednesday, the shares of Neuland Laboratories Ltd, trading at Rs. 13,808 up by 5 percent after making a high of Rs 13,866.95 compared to its previous closing price of Rs 13,196.05.
What Happened
Neuland Laboratories Limited specializing in the development and manufacturing of Active Pharmaceutical Ingredients (APIs) and custom synthesis services, held a board meeting on January 21, 2025, during which they approved two major capital expenditure projects.
The first project approved by Neuland Laboratories focuses on enhancing capacity at Unit 1 in Bonthapally Village, Telangana. The existing capacity of 0.5 KL for peptide synthesizers, with a current utilization rate of 30 percent, will be increased by 6.37 KL.
The expansion is expected to be completed by FY27, with an investment of Rs.254 crores, financed through borrowings and internal accruals. This expansion aims to support the development and commercial production of peptides for the GDS and CMS business, strengthening the company’s capabilities in the peptide segment.
The second project involves enhancing capacity at Unit 3 in Gaddapotharam Village, Telangana. The existing capacity of 321 KL, with a utilization rate of 40 percent, will be increased by an additional 52 KL.
The expansion is expected to be completed in 15 to 18 months, requiring an investment of Rs.88 crores, financed through internal accruals. This project is aimed at meeting the growing customer demand and supporting the company’s continued growth.
Ace Investor
Vijay Kedia holds in the name of Kedia Securities PVT Limited around 1,30,000 shares which consists of around 1.01 percent stake in the company as of December 2024.
Mukul Mahavir Agarwal holds around 4,00,000 shares which consists of around 3.12 percent stake in the company as of December 2024.
Financials
The company’s revenue declined by 25 percent from Rs 420.8 crore to Rs 315.17 crore in Q2FY24-25. Meanwhile, Net profit declined from Rs 89.25 crores to Rs 32.84 crore during the same period.
Written by Sridhar J
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