Sun Pharmaceuticals Ltd on Saturday said it would set up a new plant in tax haven Sikkim and invest Rs 100 crore during the current fiscal.
"We are setting up a new plant in Sikkim that would cost us Rs 50 crore. The total investment proposal by the company is Rs 100 crore for the current financial year," Sun Pharma Chairman and Managing Director Dilip Shanghvi said today at a media briefing.
The first phase of the Sikkim unit was expected to be completed by March 2007 and the second phase of commercial production in 2009. The company has a total of nine units in India and one in North America.
"The Sikkim project will produce tablets and capsules for the domestic market. The unit will have a capacity to produce 300 crore tablets and capsules per annum, which will be 20 per cent increase over existing capacity," Shanghvi said.
The company has acquired five acres and the plant area would be one lakh square feet. The reason behind building it in Sikkim was the tax benefits.
The company was looking at a growth of 18-20 per cent in sales during the year. It had posted a turnover of Rs 1636.8 crore and net profit of 573.3 crore during 2005-06.
The company aimed to increase its marketshare from 3.4 per cent to four per cent. Sun Pharma said it was open for acquisitions in the US market for inorganic growth.
Sun Pharma in 1997 had taken over Caraco in the US and last year it earned revenue of USD 83 million and was the third fastest growing company in the generic industry.
The company has 50 products in the pipeline pending approval in the US and the domestic market.
Meanwhile, Sun Pharma will demerge the advanced innovative Research and Development division into a new company, which will be listed on the bourse.
"The process of demerger will be over within this fiscal," Shanghvi said.
The division will be called Sun Pharma Advance Research Company or SPARC and the paid capital would be Rs 20 crore.