This Hyderabad company, maker of pharmaceutical compounds in granular form was in the news recently, positive news. It announced of acquisition of Auctus Pharma, a manufacturer of active pharma ingredients (API), expected to be completed in the next 3 to 6 months. This acquisition is expected to add to its product portfolio, providing the company an API platform with a USFDA-approved site to strengthen its finished dosage division.

This news apart, the company has ended Q2Fy14 on a good note, like in Q1. YoY, the company reported a smart 87% jump in net profit at Rs.15 crore on a 52% rise in revenue at Rs.266 crore. The numbers have been driven, apart from a YoY lower base effect, a robust growth in all its three verticals. Once its formulation expansion at Gagillapur facility commenced operations and once customer approvals start coming in, it hopes H2 will pan out much better.  Granules is into producing pharmaceutical formulation intermediates (PFIs), Active Pharmaceutical Intermediates (APIs) and off patent drugs. Its Gagillapur plant (a finished dosage unit) has a capacity of producing 6 million tonnes a year of PFIs. Formulations account for 40% of sales, while APIs and pharmaceutical formulations intermediaries pool the rest. The next big trigger for the stock will be the commencement of commercial production of its JV with Belgium-based Ajinomoto Omnichem to set up an API plant in Vizag at an investment of $20 million. This is expected in next fiscal and over the next two years, one could see substantial revenue add up from this JV.