Shares of Torrent Pharmaceuticals fell 5 percent in the morning session on Wednesday, September 28, 2022 after the company signed an agreement to acquire a 100 percent stake in Chennai-based leading dermatology player, Curatio Healthcare, for ₹2,000 crore.
During Wednesday’s trade, the stock opened lower at ₹1499.55 against the previous close of ₹1533.85, and then it dipped to an intraday low of ₹1448.80. But then the stock quickly bounced back and rallied almost 3 percent from lows. Currently the stock is trading at ₹1489.80, down by 2.92 percent on the NSE at 12:05 p.m.
The stock touched a 52-week-high of ₹1640.46 on December 31, 2021 and a 52-week-low of ₹1235.46 on May 12, 2022, indicating that at the current level, the stock is trading at 20.58 percent above its 52-week low. Additionally, the stock has declined almost 8.43 percent so far this year.
On Tuesday, September 27, Torrent Pharma entered into a definitive agreement to acquire 100 per cent stake in Curatio Healthcare for ₹2,000 crore, that includes ₹115 crore (on the date of signing) of cash and cash equivalents in the acquired business indicating an Enterprise Value of ₹1,885 crore, the company reported.
Notably, this expands Torrent Pharma's dermatological portfolio further following its 2015 acquisition of Encore Group subsidiary Zyg Pharma. With the completion of this transaction, Torrent Pharma will become the market leader in cosmetic dermatology and one of the top 10 firms in the dermatological industry.
The Curatio operates through a network of more than 900 distributors, reaching to over 6,000 doctors through 600 MRs with product basket of 50 products across India, the official report stated.
For FY22, Curatio reported revenue of 224 crore. Sales for the year to date in August increased by 25%, and the business anticipates FY23 revenue of 275 crore.
Torrent Pharmaceuticals Ltd., founded in 1972, is a large cap company with a market capitalisation of Rs. 51,912.45 crore operating in the pharmaceuticals industry. As of the most recent trading session, the company's stock had a three-year return of 81.18 percent compared to the Nifty 100's performance of 48.97 percent.
The company reported a consolidated total income of ₹2,377.00 crore for the quarter ended June 30, 2022, an increase of 8.69 percent from the previous quarter's total income of ₹2,187.00 Crore and of 9.34 percent from the same quarter last year's total income of ₹2,174.00 Crore. In the most recent quarter, the company achieved net profit after tax of ₹354.000 crore.
The acquisition of Elder Pharma's Indian branded business in 2013, Dermaceutical business of Zyg Pharma in 2015, API plant of Glochem Industries in 2016, women healthcare brands from Novartis and Unichem's Indian branded business along with its Sikkim Plant in 2017 strengthened Torrent Pharma's position in the Indian Pharma market, the company website shows.