Morepen puts ADR issue on hold

“The issue was planned to maximise gains for the investor and we feel that in the current market conditions, launching an ADR would not help the investor in any way. We are ready with the issue, but in view of the depressed market conditions, we have decided to go slow. We will launch the issue once the markets begin to look up again,” he added.

The company, which was earlier planning to launch the ADR issue by July, has not fixed a new time-frame as yet. Morepen, Suri said, is also planning to retire all debts by the end of this fiscal. “We had total debt to the tune of Rs 168 crore. Of this, around Rs 100 crore have already been paid back and we are planning to become a debt-free company by the end of 2000-01.”

In addition, the company has also decided to split its shares in the ratio of 5-to-1. The company is seeking its shareholders’ nod on September 11 to split its share of Rs 10 par value into five shares of Rs 2 each.

The company, Suri said, is expected to clock a Rs 100 crore net profit in the current fiscal, which would mark a 100 per cent growth from the previous fiscal. The turnover is also likely to be higher by 40-50 per cent.

“We are expecting a quantum leap in profits in current year, as we are ready to reap the benefits of persistent quality excellence and research and development of the fourth largest molecule in the world, loratadine, which goes off patent across the world 2001 onwards,” Suri said.

Morepen Labs had recorded a 137 per cent growth in net profit for the first quarter of the year 2000-2001 at Rs 22 crore as against Rs 9.3 crore a year ago. Its gross turnover also went up by 50 per cent to reach Rs 106.7 crore from Rs 71 crore in the corresponding period of 1999.

The company attributed this surge to the recent export of loratadine as part supply of a $ 20 million dollar order from Europe. EPS for the first quarter vaulted to Rs 11.27 as compared to Rs 5.97 for the same period in 1999. The annualised EPS in the first quarter is at Rs 45.09 as compared to annualised EPS of last year at Rs 23.90.

Morepen has also launched zafirlukast, an anti- asthmatic molecule in global market, which is also very well received. Morepen is the first generic company in the world to file the DMF and apply for an USFDA for zafirlukast. Sultamicillin, an advanced antibiotic is also doing very well globally. Morepen has also formulated its plans to expand in the otc market in a major manner.