Piramal Pharma to inject funds into expansion, acquisitions

Piramal Pharma is a company demerged from

. Its shares were listed on stock exchanges on October 19. In a recent interview to ET, Piramal Pharma chairperson Nandini Piramal said the company would make ₹1,200 crore of capital expenditure in the next 12-18 months in antibody drug conjugate capacities at Grangemouth, the UK. It is also seeking to raise active pharma ingredients capacities at Riverview in the US, besides boosting capacities of its API facilities in India and potent injectables at Lexington in the US.

“We are going to continue to focus on organic growth and margin expansion, and scale will give us operating leverage,” Piramal said.

She said the demand for CDMO services remained strong, despite short-term challenges like exchange rate volatility, inflation and energy prices. On its third vertical, consumer health business, Piramal said the focus was currently on organic expansion.

“The valuations are very high for brands that don’t even have unit profitability. I think we expect valuation expectations will change in the next few months as there will be less funding, then we look at it,” Piramal said. The company has completed refinancing of $225 million of debt with loans raised from

, HSBC and , which she said would improve its financial metrics.

Piramal Pharma received a $360 million investment from US private equity company Carlyle Group in October 2020 in exchange for a 20% share. Piramal Pharma includes the contract development and manufacturing organisation, called the Piramal Pharma Solutions (PPS), which contributes three-fifths to the revenue. A complex hospital generics business, Piramal Critical Care (PCC), accounts for 30% of the revenue, while the rest comes from the India consumer healthcare business that involves selling over-the-counter products.