Aurobindo Pharma Targets Penicillin-G Production Surge for Boosted Profitability

Aurobindo Pharma plans to increase Penicillin-G production to over 10,000 metric tonnes annually in the next 12 months. The Hyderabad-based company's strategies aim to improve profitability through enhanced manufacturing capabilities, leveraging government support, and expanding operations in China and the US, promising significant future earnings growth.

Aurobindo Pharma is set to significantly boost the production of Penicillin-G to more than 10,000 metric tonnes annually in the next year. According to CFO S Subramanian, this move aims to enhance profitability and aligns with government support to strengthen domestic API manufacturing. The company plans further expansion at its Kakinada SEZ facility to reach 15,000 metric tonnes eventually.

The company also expressed optimism about its China-based plant, anticipating breaking even in EBITDA by Q4 and contributing more meaningfully to earnings next year. Aurobindo Pharma is making strides in the US market, with the Dayton facility entering a commercial phase and the Raleigh facility awaiting regulatory approval. The company's growth strategy focuses on complex generics, covering diverse therapeutic areas for sustainable development.

With current manufacturing capabilities exceeding 60 billion units, Aurobindo Pharma is well-equipped to meet global demand and improve operating leverage. Subramanian highlighted strong earnings growth potential, targeting a high EBITDA margin for FY26, supported by increased production and strategic initiatives across key markets.

(With inputs from agencies.)