In a significant move within the pharmaceutical investment space, the India Resurgence Fund (IndiaRF) has officially commenced a process to divest a part of its holding in Synthimed Labs Pvt Ltd (SLPL). The fund has appointed global investment bank Rothschild & Co to manage the sale and identify potential buyers, according to sources familiar with the development.
The Deal Structure and Valuation Ambition
IndiaRF is looking to offload a minority stake valued between $250 million and $300 million, one of the persons cited revealed. The transaction was reportedly launched two to three weeks ago, with several private equity firms already approached. A second source indicated that the investment firm is seeking an overall valuation of approximately $1 billion for Synthimed Labs. This exit move comes less than two years after IndiaRF initially acquired the asset.
When contacted for comment, representatives for IndiaRF and Rothschild & Co declined to speak on the matter. Synthimed Labs did not provide a response to queries at the time of reporting.
Synthimed Labs: A Recent Acquisition with Strong Roots
The stake sale initiative follows IndiaRF's acquisition of the carved-out generic active pharmaceutical ingredients (API) and contract research and manufacturing services (CRAMS) business from Ind-Swift Laboratories Ltd. That deal was finalized in March 2024 for a total consideration of ₹1,650 crore. The operations were subsequently consolidated under the special purpose vehicle, Synthimed Labs Pvt Ltd, which was incorporated on 25 July 2023.
IndiaRF, a joint venture between the Piramal Group and Bain Capital, made this investment through its first fund, which had a corpus of $629 million. The fund's portfolio also includes investments in the Ivy Group hospital chain, Impresario Entertainment, Setco Automotive, and the Thrissur Expressway project. IndiaRF is currently raising its second fund and has already deployed capital from it into Anthea Aromatics.
Company Profile and Market Position
Based in Chandigarh, Synthimed Labs manufactures APIs, advanced intermediates, and provides CRAMS services to numerous domestic pharmaceutical companies. It positions itself as a top standalone merchant in the API segment, a critical pillar of India's pharma sector. The company operates manufacturing blocks with a total reactor capacity exceeding 700 kilolitres across sites in Derabassi (Punjab), Samba (Jammu), and an R&D centre in Mohali, Punjab.
Its product portfolio is extensive, covering APIs for cardiovascular health, antidiabetics, antipsychotics, antimigraine drugs, Parkinson's disease, antineoplastics, and analgesics, among other therapeutic areas.
Synthimed serves over 1,000 customers across more than 70 countries, with exports constituting a dominant 86% of its turnover. This provides a well-diversified geographical revenue mix spanning regulated and semi-regulated markets. In FY25, the company reported robust financials, with revenue climbing to ₹1,452 crore from ₹1,197 crore in FY24. Its EBITDA saw a substantial improvement, rising to ₹469 crore from ₹305 crore in the previous fiscal year, as per an India Ratings report.
Europe was its largest market in FY25, contributing 24% of revenue. Regulated markets like the US, Japan, and South Korea contributed around 4%, 8%, and 10%, respectively. The management anticipates further growth, particularly from the US API segment, which is expected to contribute 6-7% of revenue in FY26, backed by a healthy order pipeline.
Industry Context and Competitive Landscape
The stake sale unfolds against the backdrop of a robust Indian pharmaceutical industry. India is the world's largest supplier of generic medicines, accounting for 20% of the global supply. It also plays a pivotal role in global vaccine supply. Industry projections suggest India's pharmaceutical exports could grow 10-15 times to nearly $350 billion by 2047.
However, Synthimed operates in a competitive environment. It faces intense competition for certain products from large Indian pharmaceutical players such as Sun Pharmaceutical Industries, Dr. Reddy’s Laboratories, Cipla, Zydus Lifesciences, and Torrent Pharmaceuticals. Analysts note that the company's focus will remain on regulated markets with entry barriers or moderate competition from regions like Korea and Latin America.
The proposed stake sale by IndiaRF marks a potential partial exit from a successful investment, highlighting the continued investor interest and valuation strength in India's specialized API and CRAMS manufacturing sector.
