Detailed Narrative
GLP-1 Peptide Business: Building Blocks to Fragments
Divi's has progressed from supplying protected amino acids (14-year history) to manufacturing fragments (octamers, decamers) via both SPPS and LPPS for multiple innovators. Multiple 500-litre reactors operational for qualifications. Working with customers across commercialized, Phase II and Phase III molecules. Focus exclusively on innovator CS business, not generic GLP-1. Capacity expansion ongoing. Regulatory approvals needed before commercial supplies begin.
Strong Revenue Growth Driven by Custom Synthesis Shift
Q2 revenue grew 23% YoY with CS crossing 51% of H1 revenue for the first time in recent history. H1 constant currency growth at 21%. Material consumption stable at 41% with other expenses declining from green chemistry efficiencies and backward integration. Generic business maintained 49% share through double-digit volume growth despite pricing pressure across core products like Naproxen, Gabapentin, Carbidopa and Levodopa.
Contrast Media and Emerging Growth Areas
Iodine-based contrast media products commercialized with long-term contracts showing 20-30% annual volume increases. Gadolinium compounds in qualification stage with multiple customers, expected commercial within 1-2 years. Flow chemistry being piloted for commercial scale in 1-2 years. New generic products approaching patent expiry expected to contribute from 2026. USFDA inspection at Unit-II completed successfully.
Kakinada Expansion and Financial Strength
Unit-III Kakinada project on 200 acres with ₹1,181 crores spent; phase-wise production from December 2024. Facility to support backward integration and free GMP capacity at Unit I and II. Cash on books at ₹3,602 crores providing ample flexibility. H1 forex gain of ₹28 crores. CWIP at ₹1,316 crores with Kakinada accounting for ₹1,006 crores.