Morepen Laboratories Ltd

Target & Relationship

• Target: Morepen RX Limited (MRX), wholly owned; sells and markets branded Rx products in India.
• Turnover: Rs 5,449.84 lakh; Net worth: Rs 47.72 lakh (FY2025-26).
• Promoter group directors Sanjay Suri, Varun Suri, Shalu Suri also MRX directors.
• Industry: Pharmaceutical.

Transaction Details

• Shares allotted to Morepen: 2,00,00,000 equity shares at Rs 10 each.
• Consideration: Cash of Rs 20 crore.
• Post-allotment Morepen holding in MRX: 2,70,82,356 shares; MRX remains 100% subsidiary.
• Regulatory approvals: Not applicable.
• Completion timeline: Not applicable.

Target Background

• MRX incorporated 17 March 2023; operates in India selling branded Rx products.
• Turnover history: 2023-24 Rs 8,383.45 lakh; 2024-25 Rs 11,276.35 lakh; 2025-26 Rs 5,449.84 lakh.

Meeting Details

• Date: 4 August 2026; Time: not disclosed; Location: not disclosed.

Key Agenda Items

• Un-audited standalone and consolidated results for quarter ended 30 June 2026 to be considered and approved.
• Fix the record date for final dividend for year ended 31 March 2026.

Other Notes

• Trading window remains closed till 6 August 2026, 48 hours after results declaration, for designated persons.

Senior Management Resignation

• Resignation of Mr. Bhola Prasad, General Manager - Process Engineering & Technology Transfer.
• Effective date: July 6, 2026; reason: personal reasons to pursue career growth outside the company.

CDMO mandate progress and capacity plan

• First ₹50 crore dispatch completed in Q1FY2026-27 under the ₹825 crore CDMO mandate.
• Expect additional supplies of about ₹225 crore in Q2FY2026-27, subject to schedules.
• Total reactor capacity to reach about 600 KL by end of Q2, then 800 KL and 1,000 KL.
• Company aims to build a scalable CDMO platform through long-term customer partnerships.
• Milestone marks transition from validation to commercial execution.

MD elevation

• Change type: Elevation of Sanjay Suri (DIN 00041590) from Whole-time Director to Managing Director.
• Effective date: 1 July 2026.
• Term: for balance tenure up to 12 August 2028.
• Subject to member approval within prescribed statutory timelines.
• Reason: recommended by the Nomination and Remuneration Committee.
• Profile: B.Sc.; over 30 years in the pharmaceuticals industry.
• Experience: international sales and marketing, JVs, regulatory approvals including US FDA.
• Relationship: promoter-group member and brother of Sushil Suri, Chairman and MD.
• Impact: no change to board or committee composition is reported.

Business overview

• Morepen operates API, CDMO, and medical devices businesses.
• Management is shifting toward long-duration, recurring manufacturing programs.

Operational highlights

• Commercial production began under a Rs. 823 crore multi-year mandate.
• Q4 FY26 revenue rose 22% YoY to Rs. 472 crore.
• API revenue grew 17% in Q4; devices revenue grew 31%.
• Audits and validation batches were completed for CDMO programs.

Financial performance

• FY26 revenue increased 8% to Rs. 1,703 crore.
• FY26 EBITDA was Rs. 135 crore versus Rs. 169 crore last year.
• FY26 PAT fell to Rs. 66 crore from Rs. 102 crore.
• Q4 EBITDA margin was 8.6%; PAT margin was 4.3%.
• FY26 EBITDA margin was 7.9%; PAT margin was 3.9%.

Capital structure

• No capital raise, debt change, or liquidity update was disclosed in this chunk.

Strategy and outlook

• Capacity is planned to expand from about 500 KL to 800 KL, then 1,000 KL.
• Management targets a 10-11% EBITDA range, with a path to 20%+.
• Focus areas include long-term supply contracts, better mix, and operating leverage.
• Devices growth will come from chronic care, CGM, digital health, and international expansion.

Risks

• API pricing remained volatile in select categories during FY26.
• Scale-up investments pressured near-term profitability.
• Management expects long-duration programs to improve operating leverage over time.

Governance

• No board, management, or shareholding changes were disclosed in this chunk.

Q4 FY26 results

• Gross revenue rose 22% year-on-year to Rs. 472 crore.
• Net profit increased 69% year-on-year to Rs. 20 crore.
• EBITDA was Rs. 32 crore versus Rs. 33 crore last year.

FY26 performance

• Standalone gross revenue crossed Rs. 1,700 crore, up 8% year-on-year.
• Medical Devices revenue grew 21% to Rs. 598 crore.

Business developments

• Commercial production began under the long-duration CDMO manufacturing program.
• Validation batches were completed and initial supply schedules aligned.
• The company completed its fourth consecutive USFDA inspection with nil 483 observations.

Capacity expansion

• Manufacturing capacity is expanding from about 500 KL toward 800 KL.
• The longer-term roadmap targets about 1,000 KL.

Governance and outlook

• Board proposed a 10% dividend for FY26.
• Management expects scale-up and long-duration programs to support margins and earnings visibility.