 "Akums Drugs freezes in 5% upper circuit on sales pact with South Korean Co")
Shares of Akums Drugs and Pharmaceuticals were locked in a 5 per cent upper circuit on Tuesday after the company said that it has signed a sales agreement with Caregen, a leading South Korean company in the Nutraceuticals segment.
“Akums has been granted the exclusive rights to sell certain Caregen products in India, during the term of the agreement. Further the company shall also undertake the packaging, marketing and selling of Caregen’s line of bulk product under the Caregen’s trademark or Akums’s trademark or of Akums’s Clients trademark,” the company said in a regulatory filing.
Caregen is a global leader in peptide research and development and a global biotechnology company that has commercialised the unlimited expandability of its patented peptides as many innovative products, the company said.
Akums Drugs & Pharmaceuticals is a contract development and manufacturing organisation (CDMO) providing sale of branded pharmaceutical formulations and the manufacturing of active pharmaceutical ingredients (APIs).
Q2 results
For the second quarter of financial year 2024-25 (Q2FY25), the company’s earnings before interest, tax, depreciation, and amortisation (Ebitda) fell 28 per cent year-on-year (Y-o-Y) to Rs 134.7 crore, with margins contracting by 290 basis points (bps) to 12.9 per cent compared to 15.8 per cent in Q2FY24. Meanwhile, the company's revenue declined 12.5 per cent Y-o-Y to Rs 1,033 crore. However, profit after tax (PAT) rose 9 per cent Y-o-Y to Rs 66.7 crore.
The CDMO segment, which accounts for 77 per cent of the company’s revenue, saw its Ebitda drop to Rs 122.7 crore in Q2FY25, down from Rs 188.2 crore in Q2FY24. Margins in this segment also declined to 15.4 per cent from 20 per cent a year earlier.
The management acknowledged Q2FY25 as a challenging quarter, citing sluggish demand. However, they noted sequential growth (quarter-on-quarter) across revenue, Ebitda, and PAT. The year-on-year comparison, they explained, was influenced by exceptionally high research and development (R&D) project income recorded in the corresponding quarter of the previous year.