| Kopran Limited | ||||||
| Ratings continues on 'Watch Developing' | ||||||
| Rating Action | ||||||
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| Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings. | ||||||
| 1 crore = 10 million | ||||||
| Refer to Annexure for Details of Instruments & Bank Facilities |
Detailed Rationale Crisil Ratings has continued its ratings on the bank facilities of Kopran Limited (Kopran; past of Kopran Group) on ‘Rating Watch with Developing Implications’.
Crisil Ratings had placed the ratings on Watch with Developing Implications on April 01, 2025, following the announcement made by Kopran regarding the proposed scheme of amalgamation of Kopran Laboratories Limited (KLL) into Kopran. The said scheme of amalgamation is pending certain regulatory approvals from Bombay Stock Exchange (BSE), National Stock Exchange (NSE) and National Company Law Tribunal (NCLT). Crisil Ratings will continue to monitor the progress of the amalgamation and will resolve the watch with appropriate rating action post completion of the same.
The ratings continue to reflect the established market position of the group, driven by extensive experience of promoters and comfortable financial risk profile. The strengths are partially offset by volatile operating profitability and working capital intensive nature of operations. |
Analytical Approach For arriving at its ratings, Crisil Ratings continues to fully consolidate the business and financial risk profiles of Kopran and its wholly owned subsidiaries, Kopran Research Laboratories Limited (KRLL), Kopran Lifesciences Ltd, and Kopran (HK) Ltd, Hong Kong, and Kopran (UK) Ltd, collectively referred to as the Kopran group, as they are in the similar line of business and have significant operational and financial linkages.
Please refer Annexure - List of Entities Consolidated, which captures the list of entities considered and their analytical treatment of consolidation. |
Key Rating Drivers & Detailed Description Strengths: Established market position: Group has an established market position in both formulations and API segment in both domestic and international markets driven by a promoter’s experience spanning over four decades.
This experience has helped them in understanding business cycles and developing long-standing relationships with key stakeholders. Group has benefitted from this experience and is catering to diverse therapeutic segments like anti-diabetic, anti-infective, anti-hypertensive amongst others.
Group also exports to various geographies like Africa, Canada, Middle East, United Kingdom, Southeast Asia. On the back of experience of promoters, diverse product offerings and regions catered to lead to an operating income of Rs 630 Cr in fiscal year 2025.
Comfortable financial risk profile: The financial risk profile of Kopran Group has remained comfortable over the medium term on the back of healthy networth and limited reliance on external debt as evidenced in gearing remaining below 0.30 times for the past five fiscal years through fiscal year 2025.
Debt protection metrics also remain comfortable with interest coverage and net cash accruals to adjusted debt at 8.09 times and 0.27 time respectively for fiscal year 2025. Financial risk profile is estimated to remain comfortable over the medium term is absence of any debt funded capex plans.
Weaknesses: Volatile operating profitability: Operating profitability of the group has remained volatile between 9.57%-13.31% in the past three fiscal years ended fiscal year 2025. Kopran earns around 50%-55% of its revenue from sales of active pharmaceutical ingredients making is susceptible to any volatility in prices and demand emanating from this segment.
Volatile raw material prices had led to a moderation in operating profitability to 11.94% in fiscal year 2025. Sustained improvement in operating profitability will remain a key monitorable.
Working capital intensive nature of operations: Operations of the group continue to remain working capital intensive as reflected in a Gross Current Asset (GCA) of over 280 days as on March 31,2025 as against 264 days as on March 31, 2024.
Increase in GCA days was a result of higher inventory days which increased from 95 days as on March 31,2024 to 112 days as on March 31, 2025. Debtor days continue to remain high and averaged in the range of 100-130 days over the past five fiscal years. These working capital requirements are met by bank lines and creditors. |
Liquidity: Adequate Liquidity position of the group is adequate, marked with an estimated net cash accruals generation of over Rs 45-46 Cr for fiscal 2026 as against repayment obligations in the range of Rs 2-3 Cr. Bank limit utilization is moderate and averaged at 53% for the past twelve months ended May 2025. Kopran also has free cash and cash equivalents balance of Rs 19-20 Cr as on March 31,2025 |
Rating sensitivity factors Upward factors:
Downward factors:
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About the Group Kopran was incorporated in 1958, promoted by the Mumbai-based Somani family. The company, which is a part of the Parijat group, is managed by Mr Surendra Somani. It manufactures pharmaceutical formulations such as antibiotics, anti-malarial, analgesics, and cardiovascular and bulk drugs at its facilities in Mahad and Khopoli in Maharashtra. In fiscal 2015, the bulk drugs division was transferred to KRLL through a slump sale. Kopran Lifesciences Ltd and Kopran (HK) Ltd, Hong Kong are small entities and nearly defunct. |
Key Financial Indicators (Consolidated)
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Any other information: Not Applicable |
Note on complexity levels of the rated instrument: |
Annexure - Details of Instrument(s)
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Annexure – List of entities consolidated
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| Annexure - Rating History for last 3 Years | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| All amounts are in Rs.Cr. | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Annexure - Details of Bank Lenders & Facilities | ||||||||||||||||||||||||||||||||||||||||
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Criteria Details
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