How Biocon plans to reduce debt

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₹2,888 crore for FY23—three times that is ₹8,664 crore ($1.04 billion). The company has “a range of options" to achieve debt reduction, he said, though it was “unlikely" it would sell equity stake in any of its units. “We have the potential to generate cash from our business operations, and we’ve also explored licensing opportunities in the past, which could contribute additional income.

Moreover, we could consider financial restructuring regarding our existing debt. There are various options available to address our leverage, and we’re open to exploring them to bring about the desired outcomes," he said. The $200 million prepayment was made through receivables and out-licensing deals.

The company may also not require cash for capital expenditure as it is coming to the end of its investment cycle. Biocon said in December 2023 it was in the middle of a $500-million capex plan for the generics business, which is currently witnessing a slowdown. “We are not going forward with that, we are coming towards the end of the investment cycle for the generic business, where we have strengthened capacities and capabilities in both fermentation and APIs," Bains added.

During the third quarter of the current financial year, the company said revenue from the generics business was down 7% to ₹703 crore. However, it sees significant growth opportunities in this segment, driven by the investments that it has already made, particularly in the development and manufacture of peptides, commonly used in dietary supplements . “Central to the capex programme in generics is to build the capacities and capabilities of development and manufacturing of peptides, which we still have to complete.