Piramal Group on Thursday said it plans to invest nearly Rs 7,000 crore in its pharmaceutical business in the next five years.
“In the next five years we believe that we will spend about Rs 7,000 crore in pharmaceutical business through drug discovery in our pharma solution,critical care business and the OTC business,” Piramal Group Chairman Ajay Piramal said.
The investment of Rs 7,000 crore will include both organic and inorganic route,Piramal added.
“We have a roadmap to build this business in the pharma space,” Piramal said. On Wednesday,Piramal Healthcare announced buying a 5.5 per cent stake in Indian joint venture Vodafone-Essar for about 640 million (nearly Rs 2,900 crore).
The company,which has a cash balance of Rs 10,000 crore,said it will look into investment opportunities in other sectors and that investment in pharma segment will be spread over the next five years.
Piramal said pharma sector alone would not be able to absorb the company’s cash surplus and it needs to invest in other sectors as well.
“Pharmaceutical is an important sector for us but with the additional funds we have,I don’t think pharmaceutical sector alone would be able to absorb the funds,” Piramal said. Last year,Mumbai-based Piramal Healthcare sold its domestic formulations business to US drug firm Abbott laboratories for $3.72 billion (around Rs 17,500 crore).
The company said it is looking at acquiring minority equity stakes in the firms where it would not be involved in management.
“We are looking at minority equity stakes which means that in some of the investments we are not involved in management and any such thing,” Piramal said.
The company said it is eyeing global firms in high growth sector and investments will only be for short and medium term. Shares of Piramal Healthcare were trading at Rs 379.45 on the Bombay Stock Exchange in late afternoon trade,up 2.72 per cent from its previous close.