Drug firm Jubilant Life Sciences on Friday reported a 18.88 per cent rise in consolidated net profit at Rs 249.39 crore for the quarter ended September 30, 2019.
The company said its board has also approved demerger of the Life Science Ingredients business.
Jubilant Life had posted a net profit of Rs 209.77 crore in the corresponding July-September period of the previous fiscal, it said in a filing to the BSE.
Consolidated total revenue from operations stood at Rs 2,265.93 crore for the quarter under consideration as against Rs 2,269.49 crore in the same period a year ago.
"We witnessed steady performance in revenue and improvement in operating profits in Q2'FY20 both on a YoY basis and sequentially," Jubilant Life Sciences Chairman Shyam S Bhartia and Co-Chairman & MD Hari S Bhartia said.
The board of the company has approved the recommendations of a committee constituted to consider the option of reorganising the businesses of the company.
The board has given go-ahead to demerger of the Life Science Ingredients (LSI) business of the company with an objective to create separate and focused entities for Pharmaceuticals and LSI businesses respectively to unlock shareholder value, the filing said.
It also approved the amalgamation of promoter shareholding companies into Jubilant Life Science Ltd (JLL) with an objective to simplify the holding structure of the promoters with no change in ownership percentage and number of shares of the promoters in JLL, it added.
The composite scheme of arrangement will be filed with the National Company Law Tribunal (NCLT) for its approval, the company said.
Post the scheme becoming effective, the LSI business will stand demerged into the resulting entity, which will be listed on NSE and BSE with a mirror shareholding of JLL, it added.
"We believe that the proposed demerger will ensure depth and focus to adopt strategies necessary for growth, unlock shareholder value with direct ownership and attract focused investors in each of the business entities," Bhartias said.
The proposed amalgamations will also simplify the promoter shareholding structure of JLL, they added.
The pharmaceutical entity will have three businesses post demerger -- Pharma business, Drug Discovery Services and Proprietary Drug Discovery business, the company said.
The demerged LSI business along with its subsidiaries into the resulting entity will engage in specialty intermediates, nutritional products and life science chemicals, it added.
Shares of Jubilant Life Sciences on Friday closed 1.45 per cent lower at Rs 561.35 per scrip on the BSE.