Neuland Laboratories Shares Surge Over 4% on ₹342 Crore Expansion Plan

Neuland Laboratories Ltd, a leading pharmaceutical company, witnessed a 4.53% rise in its share price on NSE, opening at ₹13,751. This surge came after the company disclosed plans for a significant capacity expansion at its Telangana-based facilities, with a total investment of ₹342 crore.

Unit-1 Expansion: Boosting Peptide Manufacturing Capabilities

At its Bonthapally-based Unit-1, the company plans to dramatically increase its peptide synthesiser capacity from 0.5 KL to 6.37 KL. This expansion is aimed at bolstering the manufacturing of peptides, critical components for both generic drug substances (GDS) and custom manufacturing solutions (CMS).

• Investment Details: ₹254 crore will be allocated to this project.
• Completion Timeline: The expansion is expected to be operational by FY27.
• Funding: The project will be financed through a combination of debt and internal accruals.

In its regulatory filing, Neuland Laboratories highlighted that this development aligns with its long-term growth strategy and will allow the business to scale its peptide manufacturing operations significantly.

Unit-3 Expansion: Scaling Production Capacities

Unit 3, located in Gaddapotharam, is also set for capacity augmentation. The production capacity at this unit will increase from 321 KL to 373 KL.

• Investment Details: ₹88 crore, inclusive of GST, has been earmarked for this project.
• Completion Timeline: The project is anticipated to be completed within 15-18 months.
• Funding: Unlike Unit-1, this expansion will be entirely funded through internal accruals.

This development is part of Neuland Laboratories’ strategic focus on enhancing its production capabilities across all segments.

Long-Term Plan

These capacity expansions underscore Neuland Laboratories’ commitment to leveraging its existing capabilities and exploring new business opportunities. By significantly increasing its peptide synthesis and manufacturing capacities, the company aims to strengthen its position in the pharmaceutical sector, catering to both generic and custom manufacturing markets.

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