Shares of Neuland Laboratories Ltd increased by 5% on 22 January following the pharmaceutical company’s announcement that its board of directors had authorized capital expenditures for Telangana factories worth Rs 342 crore to increase capacity.

Neuland Laboratories is investing heavily in expanding the manufacturing capacity at two significant factories in Telangana in order to meet the growing demand.

Peptide synthesizer capacity would be increased at the company’s Unit 1 unit in Bonthapally Village, Gummadidala Mandal, Sangareddy District. The existing capacity of 0.5 KL, which is being used at a rate of 30%, will be expanded by 6.37 KL by FY27. 

The entire amount needed for this expansion would be Rs 254 crores, which would be paid for by a mix of internal accruals and borrowings. This capacity increase will support the commercial production and development of peptides for the GDS and CMS companies.

Neuland Laboratories intends to increase the capacity of its Unit 3 factory at Gaddapotharam Village, Jinnaram Mandal, Sangareddy District, from 321 KL to 52 KL. The current consumption rate is 40%, and the proposed capacity augmentation is expected to be completed in 15 to 18 months. The entire Rs 88 crore investment needed for this development would come from internal accruals. The goal of this activity is to meet the increasing demand from clients and ensure that the company is well-positioned for future growth.

Neuland Laboratories specializes in the production and distribution of pharmaceuticals in large quantities, catering to both domestic and international markets.

At 2:52 pm, the shares of Neuland Laboratories were trading 4.71% higher at Rs 13,844.65 on NSE.

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