Cadila Pharma likely to go public

Indravadan A Modi, chairman of the Ahmedabad-based pharmaceutical major Cadila Pharmaceuticals, gave an indication for the first time on Friday that the company will go public in the near future.

He, however, said that the Rs 600 crore (Rs 6 billion) Cadila Pharmaceuticals is generating adequate funds at the moment and there are no immediate plans to raise funds from the public. Gearing up for the post-January 2005 era, Cadila has considerably beefed up its research and development facilities, and branched out into biotechnology, plant tissue culture and other diversified activities.

Posting a turnover of around Rs 600 crore, Cadila has drawn up a plan to register a turnover in excess of Rs 1,000 crore (Rs 10 billion) in the next three years.

"We are generating adequate funds at the moment. That is a trump card that I will hold close to my chest for the moment. But I will definitely play the card. The company will definitely go public, but not in the immediate future. It may even be about five or six years from now," Modi said.

He also stated that the company is considering a unit outside the state, as such a move has become almost a compulsion for major pharmaceutical companies due to tax benefits.

Modi did not specify whether it would be a formulations or bulk drug manufacturing facility, but said that the move is being considered seriously by the company.

"The company already has its reach in 40 countries and has diversified in a big way. The foundations for expanding out further are ready and we are looking at expanding out of Gujarat. It might be too early to say where we propose to set up our new facility," he said.

Cadila has re-located its manufacturing operations at Dholka, located 50 km away from Ahmedabad. Spread over 44 acre, the plant has seven `zones of cleanliness' that have been defined and adhered to as per the 1997 GMP guidelines of the European Union.

The complex also houses its own full-fledged research and development centre, set up at a cost of Rs 20 crore (Rs 200 million).

The plant is equipped with high-speed machines and integrated packaging lines to be cost efficient.

Cadila is among India's best research pharmaceutical companies, focusing on areas of formulations (human and veterinary), new drug discovery, novel drug delivery, active pharmaceutical ingredients, analytical research, biotechnology, plant tissue culture, biosynthesis, genetic engineering, vaccines and immunoglobulins.

The diversified operations include hospital disposables and instrumentation, diagnostics, specialty chemicals, softgel, pharma machinery, telecommunications, travel and leisure.