Dishman targets US & Japan in international expansion

By Nick Taylor

- Last updated on GMT

Related tags Generally accepted accounting principles

Dishman is pushing ahead with its international expansion, increasing efforts to win contracts in the US and Japan and nearing completion of a facility Shanghai, China, which is the first it has built outside of India.

The India-based business has an established presence in Europe, having bought facilities from Solvay and Solutia, but its US and Japanese operations are less developed and the company is looking to rectify this.

VVS Murthy, chief financial officer at Dishman, told DNA India​ the company is aiming to generate $5-10m (€3.4-6.9m) from Japan this fiscal year, having entered the market six months ago.

The majority of this will be from Dishman’s contract research and manufacturing services (CRAMS) business, which generated 73 per cent of revenues in the latest financial results.

Dishman is also hoping to win more contracts in the US. Murthy said that the contracts Dishman is working on will probably materialise in the 2010-11 financial year.

International infrastructure

Murthy also gave an update on the progress of Dishman’s facility in Shanghai. The site is due to be complete in October, after which it will begin producing quaternary salts and medicine intermediates for international clients.

Dishman has invested $10m in the facility that houses a production plant, warehouse, on-site utilities and quality control offices. Murthy believes that it will generate revenues of $10m this fiscal year and $20-25m annually after that.

This will provide a financial boost to the company, which, in keeping with other businesses in the outsourcing sector, saw income from operations fall by 33 per cent in the last quarter.

Dishman’s declining income was mainly as a consequence of the CRAMS business. Revenues from this segment fell 40 per cent. There was also a slight decline in revenues from Dishman’s marketable molecules business.

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