Mankind Pharma has executed a Business Transfer Agreement (BTA) to transfer its Over-the-Counter (OTC) business undertaking to its wholly owned subsidiary, Mankind Consumer Products Private Limited (MCPPL), on a slump sale basis.
Mankind Pharma’s consumer products portfolio includes several trusted brands Manforce, HealthOK, Prega News, AcneStar, Unwanted and Gas-O-Fast across categories such as wellness, hygiene, and personal care products.
According to its statement, this strategic realignment is part of Mankind Pharma’s broader strategy to enhance its focus on the consumer business, which currently contributes 7% of the company’s overall revenue.
In Q1 FY25, the OTC business reported revenues of ₹206 crores, with an EBITDA margin of 19.5%. For FY24, it achieved a total revenue of ₹706 crores, maintaining a healthy EBITDA margin of 19.9%.
By subsidiarization of the OTC business into a wholly owned subsidiary, Mankind Pharma aims to better capitalize on the potential of this business segment, recognizing its unique business needs. This dedicated focus will enable in attracting the of specialized talent, tailored strategies around consumer needs and differentiated distribution channels. This move will allow the OTC business to thrive independently and will drive it to higher growth levels.
The transfer of the OTC business, will be undertaken as a going concern, meaning the business will continue to operate without interruption. As part of the slump sale, the transaction has been completed for a lump sum consideration.
About this announcement, Rajeev Juneja, Vice-Chairman & Managing Director of Mankind Pharma, said, “This decision has been made because the consumer business was previously managed with a concoction of pharmaceutical and consumer-focused strategies, which we believe can be better streamlined with a more tailored approach. We aim to differentiate the consumer business, with select leadership, specialized talent, and dedicated resources to help it thrive.”
“The consumer business is very close to our heart, and it currently contributes 7% to our overall business. Our ambition is to elevate this contribution to 15% in the long run. This requires a distinct business, where core stockists, major distributors, and specialized networks play a pivotal role, and we are committed to improving and building on those resources. By sharpening our focus on the consumer segment, we aim to strengthen brand recall and ensure our consumer brands resonate more effectively with our audience. This strategy is designed to accelerate growth in the consumer health space while improving operational efficiency across both pharmaceutical and consumer divisions,” he added.
