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Informist, Wednesday, Feb. 11, 2026

 

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--Divi's Lab: Raw material prices were broadly stable in Q3
--CONTEXT: Divi's Lab managment comments in post-earnings analyst call
--Divi's Lab: Raw material prices seen remaining stable for next six months
--Divi's Lab: Cash, cash equivalent at INR 36.86 bln as on Dec 31
--Divi's Lab: Construction of pilot plant for GLP-1 products completed
--Divi's Lab: To commercialise several molecules in 2027
--Divi's Lab: 78% of materials procured from Indian suppliers now
--Divi's Lab: Considering to expand Kakinada plant
--Divi's Lab: Multiple custom synthesis pdts in the pipeline to drive growth

 

By Narayana Krishna and Shweta

 

HYDERABAD/MUMBAI – Divi's Laboratories Ltd. Wednesday said it has multiple molecules at various stages of development and validation in the custom synthesis segment. The company expects some of them to be commercialised in 2027.

 

"Multiple projects are progressing well and are at various stages of development, with a few moving closer to commercial volumes over the next one year," the Divi's Laboratories management said in a post-earnings conference call with analysts.

 

Divi's Laboratories makes complex drug intermediates or active pharmaceutical ingredients exclusively for innovator pharmaceutical companies under long-term contracts. Such contracts constitute the company's custom synthesis business. In this segment, Divi's Laboratories develops and produces molecules designed by global pharmaceutical clients, typically for patented drugs, and supplies them on an exclusive basis rather than selling them in the open market.

 

Nearly 57% of the company's total revenue comes from the custom synthesis business. For the December quarter, Divi's Laboratories reported a net profit of INR 5.98 billion on a revenue of INR 25.78 billion.

 

Referring to its earlier guidance, the management said the upcoming molecules are expected to provide enormous growth opportunities. "The sky is the limit to dream," it said.

 

The custom synthesis segment usually involves high entry barriers, stringent regulatory compliance, and multi-year supply agreements, making it a relatively stable and higher-margin business compared with the company's generic active pharmaceuticals segment. The generic API segment accounts for 43% of the company's total revenue.

 

Without giving specific product details, Divi's Laboratories said the company is working actively on upcoming glucagon-like peptide-1 opportunities, and the construction of a pilot plant at its Visakhapatnam campus has been completed.

 

The company also plans to expand its Kakinada plant by adding four new manufacturing blocks. But the complete plan and capital expenditure evaluation are yet to be finalised, the management said. As of Dec. 31, Divi's Laboratories had cash and cash equivalent of INR 36.86 billion in its kitty.

 

The management said raw material costs were stable in the December quarter and are expected to remain stable for the next six months. The company is diversifying its material procurement by cutting the dependency on China, it said, adding that 78% of the materials sourced by the company now come from domestic suppliers.

 

On Wednesday, shares of Divi's Laboratories closed 3.4% higher at INR 6,386.50 on the National Stock Exchange.  End

 

Edited by Rajeev Pai

 

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