India Ratings & Research (Ind-Ra) has assigned Jubilant Life Sciences (JLL) proposed Rs 4,000 million non-convertible debenture (NCD) an 'A+(exp)' rating. The agency has also affirmed JLL's long-term issuer rating at 'A+'. The outlook is stable.
The proceeds from the proposed NCD are to be used by JLL for general corporate purposes including repayments of existing debt. The assignment of the final rating is contingent upon the receipt of final documents conforming to the information already received.
JLL has established operations across the entire pharmaceutical value chain - right from the inception of a drug concept (through drug discovery and development solutions business), walking past the active pharmaceutical ingredients (API) business and culminating into the final dosage or injectable products. Moreover, the company also provides contract manufacturing at various levels which helps it derive business from major pharmaceutical players globally.
JLL has a high degree of vertical integration with the solid dosage formulation business leveraging upon the in-house API unit. The company is also the largest supplier for pyridine and is exploring stabilisation of commercial volumes for Symtet, another pyridine integrated product thus moving further in the pyridine value chain. This level of vertical integration helps the company achieve cost competitiveness and also helps in stabilisation of operation by having a consistent raw material supply.
JLL supplies to a global market. The company derives 25% of its revenue from domestic sales while a substantial 58% is earned by supplying to the regulated markets of US and EU/Japan. Another 9% is derived from sales in the Chinese market while the rest 8% is from supplying to the rest of the world. The company has been growing its presence in Russia, Brazil and South Africa by both licensing out and developing own distribution networks.
Shares of the company declined Rs 0.45, or 0.26%, to settle at Rs 169.40. The total volume of shares traded was 231,493 at the BSE (Thursday).
