Divis to spend Rs 300 crore on expansion plans in 2018
HYDERABAD: Drug firm Divis Laboratories is focussed on expanding capacities of existing plants, even as its proposed plant at Kakinada, Andhra Pradesh ran into rough weather, a senior official of the city-based drug maker said here today.
The company spent about Rs 400 crore till December last year and will be spending another Rs 300 crore on the expansion programme during the current year, L Kishore Babu chief financial officer said.
"Kakinada plant (in AP) may take some more time. The state government has to resolve the farmers issue. We will not undertake any work there until the farmers issue is resolved. So we are expanding the capacities of the existing plants," Kishore Babu told PTI here.
"Capex for next year has not yet been decided. By March we will finalise it," he added.
The state government allotted 505 acres of land at Ontimamidi Village (Kona), Thondangi Mandal, East Godavari District, and gave the company advance possession of the land, pending procedural formalities.
The company has spent an amount of Rs 34.35 crore last year towards the cost of land and minor civil works at the site. The government has registered land of an extent of 351.72 acres in favour of the company, Divis said in its annual report of FY17.
Several farmers whose land had been acquired or resumed by the government moved the High Court either contesting the acquisition or seeking higher compensation.
Replying to a query, Kishore Babu said production at their Visakhapatnam plant has been normalised after the US FDA gave establishment inspection report (EIR) to the facility.
"Production in the Vizag plant has been normalised," he added.
Divis which has four manufacturing facilities is engaged in manufacturing leading generic compounds, nutraceutical ingredients and custom synthesis of APIs and intermediates for global innovator companies, the annual report said.