PIRAMAL PHARMA

Back in pharma biz with a bang

Piramal Pharma (PPL) is a part of the Ajay Piramal group, a business conglomerate with diverse interests in financial services, real estate and pharma, among others. PPL offers a portfolio of differentiated products and services through end-to-end manufacturing capabilities across 17 global development and manufacturing facilities and has a global distribution net work. It includes Piramal Pharma Solutions (PPS), an integrated con tract development and manufactur ing organisation, Piramal Critical Care (PCC), a complex hospital ge nerics business, and India Con sumer Healthcare, which sells over the-counter products. In addition, one of PPL’s associate companies, Abbvie Therapeutics India Pvt Ltd a JV with Abbvie Inc — has emerged as one of the market leaders in the ophthalmology therapy area. Furthermore, PPL has a mi nority investment in Yapan Bio Pvt Ltd.

The Ajay Piramal group was one of the largest players in the pharma sector, with its flagship company, Piramal Healthcare, created by taking over some foreign companies operating in India, including Nicholas and Roche Products. In 2010, the group sold its domestic pharma business to Abbot but re-entered the pharma business five years ago by setting up Piramal Pharma. The company has made good progress, with its sales turnover rising from Rs 6,315 crore in fiscal 2021 to Rs 9,151 crore in fiscal 2025, and its oper ating profit, which went down from Rs 1,428 crore in fiscal 2021 to Rs 629 crore in fiscal 2023, swiftly recovering to Rs 1,445 crore in fiscal 2025. On the net profit front, after earn ing a net profit of Rs 835 crore in fiscal 2021, the company plunged into the red, incurring a loss of Rs 186 crore in fiscal 2023, but recovered to show a net profit of Rs 91 crore in fiscal 2025. What is more, prospects for the company going ahead are quite healthy. Consider:

BUMPER ORDERS

• During the first half of fiscal 2024, the company staged an impressive turnaround. At the time, Nandini Piramal, Chairperson of Piramal Pharma, pointed out that the company’s contract, development and manufacturing (CDMO) business returned to mid-term growth with contin ued order inflows, especially for differentiated offerings and inno vation-related work. She had said, “Our capacity expansion for inha lation anaesthesia products is pro gressing well as we look to capital ize on the healthy demand in the global market. Our India consumer healthcare business is delivering steady growth via our power brands. Historically, our H2 has been better both in terms of rev enue and profitability. We hope to continue our momentum in H2FY2024 and fiscal year 2024 with a robust performance.”
• Remarkable order inflows continued in CDMO during Q2FY2024 with over 40 per cent higher orders in H1FY2024 as compared to the same period a year ago.
• The company is consolidating CDMO partners through the acquisition of Hemmo Pharmaceuticals (Rs 775 crore), a 27.78% stake in Yapan Bio (Rs 101.7 crore) and a JV with Allergan.
• PPL’s focus on power brands and the e-commerce route for marketing is expected to fuel growth in the ICH segment.

BROWNFIELD PLAN

• With a view to meeting the rising demand for its prod ucts in the US, the company has decided to go for a brownfield expansion programme involving an investment of $ 90 million. The investment is in line with US President Donald Trump’s policy of manufacturing in the US under his ‘America First’ initia tive. The expansion programme is to be financed through inter nal accruals and bank loans, and is expected to be completed The share with the face value of Rs. 10 is quoted around rs. 206 after fluctuating between Rs. 308 and Rs. 135. Future prospects for the company are extremely healthy.

PERFORMANCE INDICATORS (Rs. in crore)

PATEL ENGINEERING

Pan-India leader in hydel projects

Mumbai-headquartered Patel Engineering, over seven decades old, is a leading infrastructure and construc tion services company with a PQ (pre- qualification) in con struction work in the infrastructure segment like dams, tun nels, hydro-electric projects, irrigation projects, roads, high ways, bridges, railways, refineries, real estate and townships. It has successfully completed over 250 projects, including 87+ dams, 15,000+ MWh hydro-electric projects and 1,200 km+ roads. At present, it has a marketshare of over 45 per cent in under- construction hydro-electric plants in India. The company has also executed projects in Indonesia, Singapore, Nepal and Mauritius.

Key projects executed by the company include the 520 MW Tapovan hydro-electric project, the 412 MW Rampur hydro plant, the 800 MW Parbati hydro, and the 600 MW Kameng project.

Patel Engineering’s financial performance is healthy de spite some challenging situations, including the sudden death of Chairman and Managing Director Rupen Patel. The sales turnover during the last 12 years has expanded from Rs 3,701 crore in fiscal 2014 to Rs 5,093 crore in fiscal 2025, with operating profit moving up from Rs 467 crore to Rs 733 crore and the profit at net level shooting up almost 10 times from Rs 25 crore to Rs 248 crore. Going ahead, though the short-term prospects are challenging, the long-term outlook is strong. Consider:

ORDERS CUSHION

• The company continues to receive valuable orders. Though the order book was slightly lower from over Rs 18,000 crore in fiscal 2024 to Rs 15,000 crore in fiscal 2025, it still ensures revenue visibility for at least two years.
• What is more, in recent months, the company has bagged several ambitious orders. Very recently, NEEPCO awarded a contract valued at Rs 711.29 crore to Patel Engineering for the construction of the 240 MW Heo hydro power project located in Arunachal Pradesh. The company also won a Rs 1,090-crore irrigation project in Maharashtra. On April 28, 2025, it was announced as the lowest bidder for two significant infrastructure projects by CIDCO, Maharashtra valued at Rs 1,318 crore. The company has also been confirmed as the lowest bidder for a hydro power project by the North Eastern Electric Power Corpora tion valued at Rs 718 crore.

WINNING BIDS

• Maharashtra Krishna Valley Development, Pune has de clared PEC the lowest bidder (LI) for the contract involving the construc tion of a pipeline distribution net work for the Nira Deodhar right bank main canal (from km 87 to km 135) and its distributaries. The project is to be completed in a period of 36 months. This is a joint venture project and PEC's share is 20 per cent (Rs 218.09 crore).
• Over a month ago, the company was declared the lowest bidder for two significant infrastructure projects with a combined value of Rs 2036 crore. The project's focus is on the construction of the Kondhane dam located in Raigad dis trict of Maharashtra.

BOUNCING BACK

• The sudden death of CMD Rupesh Patel unnerved the investing public and the share price charted a downward drift. However, the company soon recreated a management team led by Janky Patel, wife of Rupesh Patel, as Chairperson, and Kavita Saivaikar, erstwhile CFO of the company and a profes sional corporate manager with 26 years of experience in the infrastructure sector, as Managing Director. With this develop ment investors turend hopeful at this juncture, ace investor Vijay Kedia emerged as a leading buyer. These developments led to confidence among investors once again, and the share price, which had gone down to Rs 33, stopped declining further and recovered moderately to Rs 42. The company started doing well, registering positive OCF (op erating cash flow) for the last five years. Research analysts at IDBI Research Bu reau have set the target price at Rs 76.

PERFORMANCE INDICATORS (Rs. in crore)