Strides Shasun Q3 net jumps over 3 fold; plans restructuring

Drug firm Strides Shasun reported an over three fold jump in its consolidated net profit to Rs 187.32 crore for the quarter ended December 31, 2016 as the company today unveiled major restructuring plans.
The company had posted a net profit after taxes and minority interest and share of loss of associates and joint ventures of Rs 58.90 crore, Strides Shasun said in a filing to BSE.
Consolidated total income from operation also rose to Rs 933.93 crore for the quarter under consideration as against Rs 867.54 crore for the same period year ago.
Commenting on the results, Strides Shasun Group CEO Shashank Sinha said: "Q3 was a solid quarter of revenue growth and margin expansion backed by gains in market share of key products."

Growth was led by the formulations business as API operations normalised. Growth particularly in the regulated markets was strong despite delay in new product approvals, he added.
In another filing to the bourses the company also said that it will be renamed as Strides Pharma Ltd.

Post the structuring, the company will operate through its two divisions of Regulated and Emerging markets.
"The Regulated Markets business will have a front-end presence across Australia, US and UK. The business will be complimented by 4 USFDA approved facilities in India, Europe and Singapore (proposed facility under construction) and 3 R&D centers with 400 scientists focused on developing an integrated portfolio targeting 25 ANDA filings per annum", Strides Shasun said.

The Emerging Markets business will comprise of focus markets of Africa and India and donor funded programs under the institutional franchise, it added.
The company is planning to sell its Africa generics manufacturing business for a cash consideration of Rs 108.7 crore to the current management team led by Sinhue Noronha.
Strides Shasun is also planning to exit from its probiotic business. The promoters of Strides Shasun will acquire the 51 per cent stake in the business.
As part of the restructuring, the company is also seeking shareholders' nod to de-merge the commodity API business of Strides Shasun into a new listed entity.

"As part of the same scheme, the human API business of SeQuent Scientific Ltd (a promoter owned listed company) is also proposed to be carved-out into this new co, thereby providing critical size to this business," the company said.
"This combination will catapult the new company to be one of the largest standalone API companies in the country," Strides Shasun said.
Shares of Strides Shasun today closed at Rs 1194.30 per scrip on BSE, up 10.55 steep per cent from its previous close.