Surya Pharma to raise Rs 500 cr

Chandigarh-based Surya Pharmaceutical Ltd is planning to raise Rs 500 crore through various instrument like Rights Issue, Global Depository Receipts (GDRs), American Depository Receipts (ADRs), Foreign Currency Convertible Bonds (FCCBs) and External Commercial Borrowings (ECB) for funding its new projects, expansions, diversification, acquisitions, other business expenses and to augment working capital requirements.

Surya Pharmaceutical Ltd President, Corporate Finance, Hari Om Bhatia said, “We are planning to raise Rs 300 crore in next 4-6 months through GDR, ADR, Right Issue, QIP route etc. We are in talks with certain agencies and very soon an announcement will be made in this regard. The money raised would be utilised for funding new projects, expansions, diversification, investment in group’s retail arm venture, acquisitions, other business expenses and to augment working capital requirements. Besides, we have also plans to raise Rs 200 crore through FCCB or ECB route.”

The proceeds from the issues would be utilised to fuel its business plan, which involves setting up new API manufacturing unit near Chandigarh at an investment of over Rs 500 crore. The proposed unit will manufacture the entire range of APIs including cardio-vascular products, CNS products, hormonal products, steroids etc. Also, the proceeds from the issue would be utilised in expanding group’s Pharmaceutical retail chain ‘Viva’ which has presence in Punjab, Chandigarh, Delhi.

He also informed that the company’s new facility at Samba in Jammu & Kashmir to manufacture APIs and formulations is likely to be partly operational by next month, while it will go on in full stream by December 2010. The company has injected Rs 320 crore in the facility.

In 2008-09, the turnover of the company was Rs 729 crore and in the last fiscal year the company’s turnover was Rs 1,130 crore. The company plans to expand its horizons fast and is preparing to enter European & American Pharmaceutical markets by 2011. Besides growing organically through y.o.y growth of 40-45 per cent, the company proposes to grow inorganically also through proposed acquisitions in overseas and domestic markets. Currently the company is negotiating with companies in North America for possible acquisitions. The company has also Contract Research and Manufacturing Services (CRAMS) facility near Banuar in Punjab and got serious enquires from the USA.