Akums Drugs Shares Rise on Sales Pact With South Korean Company

Founded in 2004, Akums Drugs and Pharmaceuticals Ltd. is a CDMO specializing in a wide range of pharmaceutical products and services. The shares of Akums Drugs and Pharmaceuticals Ltd. hit an upper circuit of 5% at Rs.580.95 today, following the announcement of a well-thought-out partnership with South Korea-based biotechnology company Caregen Co., Ltd. This Master Sales Agreement will directly help Akums in the country’s booming nutraceuticals market.

What’s the Deal?

Akums has bagged the exclusive rights to sell, package, and market Caregen’s nutraceutical products in India. What’s more, the products can carry Caregen’s trademark, Akums’ branding, or even that of Akums’ clients. Essentially, Akums Drugs and Pharmaceuticals Ltd. will serve as the face of Caregen’s innovative range in the Indian market.

Caregen is no small player. The South Korean firm is globally positioned in peptide research and development, with patents that power several high-impact health products. This is expected to give Akums a stronger hold in the nutraceutical segment.

Q2FY25 Numbers

Akums Drugs and Pharmaceuticals Ltd’s Q2FY25 results presented a mixed performance. Revenue declined 12.5% year-on-year (YoY) to Rs.1,033 crore, while EBITDA dropped 28% YoY to Rs.134.7 crore, with margins going down to 12.9% from 15.8%. On the brighter side, profit after tax (PAT) rose 9% YoY to Rs.66.7 crore. The company attributed the decline to sluggish demand but talked about sequential improvements in revenue, EBITDA, and PAT compared to the previous quarter.

Akums Drugs’ stock is trading at Rs.580.65 today, gaining 5% but still reflecting a 27.08% decline since August 2024.

Conclusion: In conclusion, this collaboration with Caregen could be the push Akums needs to take over the nutraceutical market. While Q2 was tough, this partnership signals the company’s intent to bounce back with innovative products that cater to a health-conscious audience. 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.