Shares of Jubilant Pharmova Ltd surged 4% on 13 June after the company announced that its board had authorized the sale and transfer of its active pharmaceutical ingredient (API) business to its wholly-owned subsidiary, Jubilant Biosys Ltd, on a slump basis.

In its regulatory filing, the company said, “the board of directors of Jubilant Pharmova in its meeting held today, i.e., 12 June 2025, at 03:00 pm and concluded at 03:28 pm, inter alia, considered and approved sale and transfer of the Active Pharmaceutical Ingredients (API) business of the company (Undertaking) on a slump sale basis to Jubilant Biosys Limited (JBL), a wholly-owned subsidiary company, engaged in providing drug discovery services to global Pharmaceutical and Biotech companies.”

In FY25, the API segment generated Rs 609 crore or 8.35% of the company’s total revenue.  As of 31 March 2025, its net worth was Rs 666.5 crore, accounting for 10.68% of the company’s consolidated net worth.

The transfer is planned to be completed by 1 September 2025, subject to the terms specified in the business transfer agreement. The consideration for the transfer shall be based on the book value of assets and liabilities as of the appointed date. The transfer will be completed principally through the issuance of shares.

Jubilant Biosys is a completely owned subsidiary. Hence, the purchase qualifies as a related party transaction. However, the corporation stated that the transaction is being conducted at arm’s length.

The sale is taking place outside of a Scheme of Arrangement, and compliance with Regulation 37A of the SEBI Listing Regulations is not necessary because Jubilant Biosys’ accounts are consolidated with those of Jubilant Pharmova.

At 12:36 pm, the shares of Jubilant Pharmova were trading 2.34% lower at Rs 1,099.30 on NSE.

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