Strides Pharma sinks after subsidiary plans to divest manufacturing plant

Strides Pharma's subsidiary, Stellis Biopharma will sell its manufacturing unit at Bommasandra Industrial Area in Bengaluru to Synege International.

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Strides Pharma Science Limited shares traded in the red on Wednesday after its subsidiary announced plans to sell off its manufacturing unit.

Strides Pharma was traded down 6.21 percent at Rs 453.55 at 1.54pm on the National Stock Exchange (NSE). On Wednesday, 20 lakh Stride shares changed hands on the NSE.

The shares went downhill after Strides Pharma subsidiary Stellis Biopharma announced to sell its manufacturing facility at Bommasandra Industrial Area in Bengaluru to Synege International, Strides Pharma said in an exchange filing on July 4. Synege International will buy the manufacturing unit for Rs 702 crore in an all-cash deal. The transaction is expected to close within 90 days.

Synege International shares was up 1.8 percent at Rs 754.6 at 12.25pm on the NSE.

The manufacturing unit has a potential for future expansion up to a further 20,000 litres of biologics drug substance manufacturing capacity. Syngene International will further invest up to Rs 100 crore to repurpose the manufacturing unit. The unit initially churned out Covid-19 vaccines and it is now being used to manufacture monoclonal antibodies. These are substances that fight harmful viruses or cancer cells.

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Strides Pharma’s total revenue increased 18 percent on-year to Rs 3,778 crore in FY23. The company’s net loss widened 55 percent on-year to Rs 202 crore in the same period. EBITDA margins for the company increased 1,028 basis points year-on-year.

Strides Pharma is known for making quality generics to fight HIV/ AIDS, TB and malaria.​

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