Mumbai: Leading pharma company Cipla Ltd
on Wednesday said it envisages a capital expenditure of up to Rs
1,500 crore for which it will tap the markets.
At its 73rd annual general meeting (AGM) here, Cipla
Chairman and Managing Director Y K Hamied said the company
envisages a capital expenditure of about Rs 500-600 crore in
the next two years and it will spend Rs 800 crore in the
current year.
He, however, said, "The company was looking to raise
funds from the capital markets at an appropriate time in the
near future, but had not yet decided on the (exact) quantum or
the route."
It is looking at options like issue of securities in
domestic/international markets through various instruments,
including equity shares or foreign currency convertible bonds
(FCCBs) convertible into equity shares of the company or
American Depository Receipts (ADRs) or Global Depository
Receipts (GDRs).
Cipla has incurred a capital expenditure of nearly Rs
2,000 crore over the last three years
The company intends to use the funds to reduce short-
term debt raised to meet working capital requirements in the
past couple of years and also to fund some of its new projects
in the next two years.
With the proposed expansion plans, Cipla's working capital
requirements would rise annually by about Rs 300 crore. It has
invested significantly in modern facilities.
The new facilities and upgrading of existing ones have to
keep pace with the growing demand for our high quality
medicines, Hameid said.
The company has invested Rs 300 crore in a new pharma
project in Sikkim, which has already supplied large quantities
of drug formulations to the domestic market. It is also
setting up a formulation unit in a special economic zone in
Indore at an estimated cost of over Rs 750 crore. This factory
complex will commence production in 2010.
It is setting up an active pharmaceutical ingredients
production facility at Bangalore and expanding its API units
in Vikhroli and Patalganga in Maharashtra.
However, the firm's SEZ project at Kerim, Goa, where it
had proposed multiple manufacturing plants, is still stuck as
the state government passed a stop-work order in 2008 after
deciding to impose a statewide ban on SEZs.
Over the past five years, the company have had an
average growth of 20 per cent each year and doubled turnover
to Rs 5,000 crore in FY 09, Hameid said.
Cipla has over 7,000 product registrations in nearly
180 countries and provides a wide range of medications, which
include HIV/AIDS, malaria and respiratory disease.
Bureau Report
First Published: Wednesday, August 26, 2009, 23:42