Paracetamol maker Granules India' Q1 profit hurt by cyber attack disruptions

Granules India

09/08/2023 12:08

HYDERABAD, Aug 9 (Reuters) - Granules India Ltd
 GRAN.NS , the maker of paracetamol and ibuprofen pain
relievers, reported a 62.5% fall in first-quarter profit on
Wednesday, as a cyber security incident significantly disrupted
operations.
    The generic drug maker's consolidated net profit tumbled to
478.9 million rupees ($5.8 million) in the April-June quarter,
from 1.27 billion rupees a year earlier.
    Granules faced a cyber security attack in May, which caused
major disruptions in its operations, affecting its IT assets. A
ransomware group has claimed responsibility, the company said.
    "(It) took considerable time to address the regulatory
expectations, qualifications, fine-tuning of quality and
production systems. This has impacted significantly the revenue
and profitability for the quarter," Granules said.
    Revenue from operations fell 3.3% to 9.85 billion rupees. 
    "Operating expenses were higher, in line with the expected
revenue, and hence the gap in sales had a severe impact on PAT,"
said Chairman and Managing Director Krishna Prasad Chigurupati.
    He said business has been restored to normal.
    The fall in profit also comes as generic drug makers grapple
with intense price competition in the U.S. and Europe from where
they draw a bulk of the revenue.
    Granules specialises in manufacturing active pharmaceutical
ingredients (API), pharmaceutical formulation intermediates
(PFI) and finished dosages (FD).
    Granules, which holds a 30% share of the global market for
paracetamol, manufactures the drug's API and also finished
dosage, ready for consumption, in European markets.
    Revenue from the finished dosage segment, its biggest, fell
2.1% to 5.37 billion rupees, while the API segment, its
second-largest, rose 28.1% due to strong paracetamol volumes,
the company said.
    Shares of the company closed 0.22% lower at 322.40 rupees.
 
 ($1 = 82.8220 Indian rupees)

 (Reporting by Rishika Sadam in Hyderabad; Editing by Savio
D'Souza)
 ((Rishika.S@thomsonreuters.com;))