Chennai-based Orchid Chemicals and Pharmaceuticals Ltd expects to break even in 2016-17 with the help of new product launches and conversion of rupee loans to foreign currency ones.

Speaking at the sidelines of the 22{+n}{+d} Annual General Meeting, K Raghavendra Rao, Managing Director, said the company is in talks with banks to convert long-term rupee loans to foreign currency debt.

The company has a total debt of about ₹3,100 crore, of which around ₹1,800 crore is the rupee loan, ₹750 crore is foreign currency loan equivalent and ₹500 crore is working capital. Orchid is paying an interest of 11 per cent for the loans. “After conversion there will be an annual saving of ₹125 crore,” Rao said. He added that only ₹1,000 crore will be converted immediately.

Some of the pending projects, which are nearing completion, will add to the revenue starting next year. A sterile plant for production of Cephalosporins is expected to be completed this year. “We will increase the capability of sterile API plant by adding 30 tonnes to the existing 50 tonnes, which will add ₹150 crore to the revenue,” Rao said.

Two new molecules for NASH (non-alcoholic steatohepatitis) and NAFLD (non-alcoholic fatty liver disease), which are currently in second phase of testing in Malaysia, will be introduced in the market after completion. Rao said, “After human trials, we should be able to license the products to larger companies in another one year.” The company has reported a net loss of ₹191 crore for the accounting period ending March 31, 2015, against ₹530 crore loss the previous year.

Speaking at the meeting, KV Venkatasubramanium, Chairman, said the company has entered into supply agreements with several pharmaceutical companies in Europe and has a long-term agreement with a Japanese pharmaceutical company for the supply of a Cephalosporin API.

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