The Indian contract research organisation (CRO) announced the plan last night after securing INR250m ($3.7m) from Canbank Venture Capital – a private equity investor – in an exchange for a minority stake.
Bioneeds said the money would pay for an additional 120,000sqft of laboratory space at the Bangalore site.
The CRO also said it plans to hire 75 additional staff with skills in drug discovery, regulatory affairs and medical device development.
Bioneeds managing director SN Vinaya Babu said the expansion would drive revenue growth and set an ambitious target for 2018.
“We have been actively looking for funds to strengthen our balance sheet and also expand our services. The funds from CVCFL shall be deployed to build additional Vivarium and Discovery Labs with state-of-the-art equipment.”
“We aim to be counted among the best Global CROs offering complete range of services” he continued,” adding that “we aim to become INR 1,000 million company in the next 3 years.”
The privately-owned CRO saw operating income of INR141.5m and profit of INR23.8m in fiscal 2014 according to analysis by ratings agency Brickwork.
Brickwork assigned Bioneeds a stable rating and said its ability to “complete the expansion project in a timely manner, ensuring timely debt servicing and effectively manage the risks inherent in the clinical research industry… would be the key rating sensitivities.”
S Thiruvadi Canbank Venture Capital Fund manager said: “Bioneeds has demonstrated this and is very well positioned to capture the growth opportunity with their well-qualified scientific manpower.
“The EBITDA and PAT margins from Bioneeds are good and CVCFL anticipates that Bioneeds with their strong customer base and progressive professional management will achieve high growth in the revenues and profitability and be able to offer significant returns through dividends and capital appreciation on exit.”