CALCULATE YOUR SIP RETURNS

Divi’s Labs Share Soars Over 3% on Signing Long-Term Supply Agreement

Written by: Team Angel OneUpdated on: May 26, 2025, 1:37 PM IST
Divi’s Laboratories' share price soars over 3% on signing a long-term deal to supply intermediates, to invest ₹650-750 crore in capacity expansion.
Divi’s Labs Share Soars Over 3% on Signing Long-Term Supply Agreement
ShareShare on 1Share on 2Share on 3Share on 4Share on 5

Divi’s Laboratories has entered into a long-term manufacturing and supply agreement with an international pharmaceutical company. The agreement covers the production and delivery of advanced pharmaceutical intermediates. Specific details such as the customer’s name and quantitative terms have not been disclosed due to confidentiality requirements.

As of 09:51 AM on May 26, 2025, Divi’s Laboratories share price was trading at ₹6,704.50, a 3.42% increase, with a 6.75% increase over the past 6 months and a 52.34% increase over the past year.

Structure of the Agreement

Under the agreement, Divi’s will manufacture and supply the required intermediates based on terms agreed between the 2 parties. The company expects a meaningful contribution to its revenue from this deal over the long term.

Capacity Expansion

To meet the production demands of the agreement, Divi’s plans to invest between ₹650 crore and ₹750 crore in expanding its manufacturing capacity. This investment will be funded through phased advances paid by the customer as part of the agreement. No external financing has been announced for the project.

The company clarified that the agreement does not involve any share exchange, acquisition, or related party transactions. There is no involvement of promoter group entities or affiliated companies.

The update was disclosed on May 24, 2025, under Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The agreement has been categorised as a material event in the company’s official communication to stock exchanges.

Read more: Divi’s Labs Posts FY25 Results with PAT Rise; Declares ₹30 Dividend

Financial Performance

Divi’s Laboratories, which manufactures active pharmaceutical ingredients and nutraceutical components, reported a consolidated net profit of ₹662 crore in the March 2025 quarter, marking a 23.04% increase compared to the same period last year. Revenue from operations for the quarter stood at ₹2,585 crore, up 12.24% year-on-year.

Conclusion

The agreement is a new international supply commitment for Divi’s, supported by customer-funded investment in capacity. The transaction is aligned with the company’s core business operations and does not involve any structural changes or related party involvement.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions. 

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.

Published on: May 26, 2025, 1:37 PM IST

Team Angel One

Team Angel One is a group of experienced financial writers that deliver insightful articles on the stock market, IPO, economy, personal finance, commodities and related categories.

Know More

We're Live on WhatsApp! Join our channel for market insights & updates

Open Free Demat Account!

Join our 3 Cr+ happy customers

+91
Enjoy Zero Brokerage on Equity Delivery
4.4 Cr+DOWNLOADS
Enjoy ₹0 Account Opening Charges

Get the link to download the App

Get it on Google PlayDownload on the App Store
Open Free Demat Account!
Join our 3 Cr+ happy customers