Divi's Labs inks long-term supply deal, plans up to Rs 700-crore capacity addition

The proposed facility is expected to be operational around January, 2027, the company said.

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26 Aug, 2025 12:21

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Divi's Labs is in the process of entering into a long-term supply agreement with a customer and is planning for capacity addition at its manufacturing facility with an estimated investment of Rs 650-700 crore, the company said in a press statement on April 25.

The investment will be funded from internal accruals.

The proposed facility is expected to be operational around January 2027, the company said. Due to the confidentiality agreement signed with the

customer, Divi's said that it is not permitted to disclose any further\ quantitative details.

Incorporated in October 1990, Divi’s Laboratories is a pharmaceutical and Biotechnology company engaged in generic API, custom synthesis and nutraceuticals. It is promoted by Dr Murli K Divi. The company has global leadership position in CRAMS and generic APIs. It is catering to therapeutic segments like cardiovascular, anti-inflammatory, anti-cancer and central nervous system drugs.

Divi's Laboratories had reported a 17 percent year-on-year (YoY) rise in its consolidated profit to Rs 358 crore for the December quarter. Revenue came in at Rs 1,855 crore, up 8.6 percent from the year-ago quarter of Rs 1,708 crore.

Bank of America Securities (BofA) recently said that it sees a favourable risk reward scenario developing for Divi's Laboratories as the stock trades at a reasonable valuation in comparison to other largecap peers.

BofA expects margins to reach 33 percent by FY26, driven by factors such as successful launch of generic active pharmaceutical ingredients (APIs) and contributions from new drug master files (DMFs).

Analysts also expect increased supplies of contrast media APIs and Good Laboratory Practice-1 intermediate supplies to play a role, along with the ramp-up of Kakinada plant after commissioning.