On Friday, August 25, Aurobindo Pharma announced that its Committee of Independent Directors will conduct a thorough assessment of all available options concerning the reorganization of its wholly-owned subsidiary, Eugia Pharma Specialities Limited. This comes in response to a news report suggesting that the company’s promoters had initiated the process of selling a majority stake in Eugia Pharma’s injectables business.
Aurobindo Pharma clarified that it had already communicated to the stock exchanges on August 12, 2023, following a board meeting, its ongoing exploration of potential restructuring strategies for Eugia Pharma Specialities Limited. This subsidiary primarily focuses on sterile/injectables, oncology, and hormonal products. The company reiterated its commitment to thoroughly evaluating various alternatives and presenting recommendations to the Board, with the goal of charting a new path for growth and enhancing value for its stakeholders.
Eugia Pharma is a specialized generic pharmaceutical company with manufacturing facilities in both India and the United States.
In its financial report for the first quarter of fiscal year 2023-24 (Q1FY24), released earlier this month, Aurobindo Pharma disclosed a 22.5% decrease in net profit, totaling ₹540 crore, compared to ₹697.6 crore during the same period the previous year. Despite this decline, the company’s revenue from operations for the first quarter of the current fiscal year increased by 9.9%, reaching ₹6,850.5 crore, as opposed to ₹6,236 crore in the corresponding period of the previous year.
This revenue growth was bolstered by double-digit expansion in the US and European formulations segments, as well as the Active Pharmaceutical Ingredients (APIs) segment. Notably, revenue from US formulations grew by 11.2% year-on-year (YoY) to ₹3,304 crore, constituting 48.2% of the consolidated revenues.
On the stock market, Aurobindo Pharma’s shares closed at Rs. 825.85 on Friday, marking a 0.94% decrease at the National Stock Exchange (NSE).