Torrent Pharmaceuticals has announced it will raise up to Rs 12,500 crore by issuing secured non‑convertible debentures (NCDs) on a private‑placement basis.
How the NCD issue works
The company may issue the NCDs in one or more batches. They will be listed on the NSE Wholesale Debt Market and will carry a first‑ranking charge over specific bank accounts and trademarks, giving lenders a safety cushion of about 1.1 times the loan amount. Details such as coupon rate, tenure and maturity will be set when the bonds are allotted.
Why Torrent is raising funds
The money will help Torrent keep enough cash on hand, support its growth plans and complete an ongoing acquisition of JB Chemicals.
- Finalize the buyout of JB Chemicals, for which SEBI has already cleared the minimum tender offer.
- Fund capital‑expenditure of Rs 250‑300 crore per year for the next three years.
- Invest in research and development, especially new GLP‑1 drugs for the US, India and Brazil.
Key financial highlights
- Q2 revenue: Rs 3,302 crore, up 14% YoY.
- Operating EBITDA: Rs 1,083 crore, margin 32.8%.
- Net debt‑to‑EBITDA: 0.45×, indicating room for more borrowing.
- Branded medicines make up about 73% of sales, with chronic‑therapy drugs driving growth.
Market reaction
When the news was released, Torrent Pharma’s shares fell slightly, trading around Rs 3,876 on the BSE, down about 0.2% from the previous close.
What investors should keep in mind
Issuing secured NCDs gives Torrent a steady source of long‑term funding while preserving its investment‑grade credit rating. The proceeds are aimed at expanding the business, completing the JB Chemicals deal and advancing its drug pipeline.
Remember, this is just an overview, not a prediction. Do your own research and consider your risk tolerance before making any investment decisions.