Jubilant Organosys boosts niacinamide (Vitamin B3) production capacity

Jubilant Organosys Limited, the leading Custom Research and Manufacturing Services (CRAMS) company in India, is setting up manufacturing facility to produce niacinamide and 3-cyanopyridine.

The new facilities, which will have a capacity to produce 10,000 TPA of niacinamide and 3-cyanopyridine each, are expected to be ready by end of 2010, Jubilant said in a press release.

Jubilant is currently ranked amongst the top three manufacturers of niacin & niacinamide (Vitamin B3) worldwide and is the only manufacturer of niacinamide with complete backward integration to  the basic  feed-stock.

Jubilant is also the largest producer of Beta Picoline globally, a critical raw material for the manufacture of Vitamin B3.

“Through our in-house research we have developed a very cost efficient and environmental friendly process for the manufacture of these products which will translate into value for our customers. We believe with our new capacity we will strengthen our relationship with the existing wide spread customers globally as well as develop new markets,” stated Pramod Yadav, CEO (Advance Intermediates & Vitamins) of Jubilant Organosys.

The niacin/niacinamide is an important life science ingredient that finds extensive usage in flour fortification, food enrichment, multi-vitamins, poultry, dairy and pigs, diabetes and cholesterol drugs and manufacture of  many life science  intermediates.

3-Cyanopyridine is an intermediate for the manufacture of niacinamide, which is also used extensively in the manufacture of various Life Science intermediates used for the production of pharmaceuticals and agrochemicals.

Jubilant Organosys Ltd has a presence across the pharmaceutical value chain for providing products and services such as proprietary products, exclusive synthesis, active pharmaceutical ingredients, contract manufacturing of sterile injectables & non-steriles products, radiopharmaceuticals, generic dosage forms, drug discovery services, medicinal chemistry services, clinical research services, and Health Care.

Jubilant Organosys reported a nearly ten-fold jump in its consolidated net profit for the quarter ended June 31, 2009.

Jubilant Organosys’ net jumped nearly ten fold to Rs 125.82 crore due to mark-to-market gains over the same period last year. Jubilant Organosys had a net profit of Rs 12.76 crore in the same period ended June 2008, Jubilant Organosys said in a press release.

The pharmaceutical sales increased by 18.1 per cent to Rs 617.18 crore from Rs 522.65 crore in the corresponding period of last year. However, its sales of industrial & performance products declined by 8 per cent to Rs 280.16 crore from Rs 304.67 crore.

Jubilant’s contract manufacturing operations (CMO) and speciality pharmaceuticals improved by 59.4% to Rs. 131.0 crore and 69.5% to Rs. 59.8 crore respectively.

International sales grew by 17.0% with revenues at Rs. 566.9 crore in Q1 FY2010 against Rs. 484.6 crore last year. The regulated markets that form a focus area for the Company showed growth of 36.1% to Rs. 421.7 crore. The contribution of North America was at Rs. 315.6 crore (up 38.9%) and Europe at Rs. 102.6 crore (up 28.9%).

Industrial and Performance Products (IPP) revenues went down to Rs. 279.2 crore from Rs.303.9 crore in Q1 FY2009 on account of lower realization and product rationalization.

Higher interest burden of Rs 40.69 crore in the quarter ended June 2009 as compared to Rs 13.77 crore in the last period and higher employees cost of Rs 183.22 crore as against Rs 125.56 crore, put pressure on profit before tax & foreign exchange adjustments, which declined to Rs 97.83 crore from Rs 125.81 crore. However, it has successfully reduced its power cost, depreciation charges and selling, general & administrative expenses during the quarter under review.

Jubilant maintained the guidance of revenue growth of 15% for FY 2010 driven by the expected growth in Pharma and Life Sciences Product and Services (PLSPS) business. PLPS grew 18.1% to Rs. 617.2 crore during the period.