NATCO Pharma Ltd has formally announced that its board will meet on Tuesday, March 24, 2026 to approve a scheme of arrangement to demerge its agrochemicals division into its wholly-owned subsidiary, Natco Crop Health Sciences Ltd, on a going concern basis. According to the company's formal notification to stock exchanges, the primary agenda item requires board approval for this strategic restructuring. The company has enforced a trading window closure for insiders from March 18-26, 2026, which applies to all employees, connected persons, and their immediate relatives, with normal trading operations set to resume on March 27, 2026.
For the third quarter of the current financial year, NATCO Pharma reported robust financial results with consolidated net profit increasing 14.3% year-on-year to ₹152 crore, up from ₹133 crore in the year-ago period. As reported by CNBC TV18, the growth was aided by higher contribution from export formulations and other operating income. Revenue from operations rose 36.3% to ₹647.3 crore from ₹474.8 crore in the corresponding period last year. For the fiscal year 2025, the company reported revenue of ₹4,784 crore and a profit after tax (PAT) of ₹1,883 crore.
The proposed demerger represents a strategic move by NATCO Pharma to unlock value within its core pharmaceutical business by separating the agrochemical division. The agrochemicals unit, which began operations in 2019, uses the company's expertise in chemistry and formulations for crop protection products. Company leaders believe this split will foster long-term growth and allow for dedicated management, with the company potentially maintaining a partial stake in the new entity to ensure shared services like R&D and patent management. The separation could create distinct growth paths for both the pharmaceutical and agrochemical businesses, with the agrochemical business planned to operate as a standalone company under the Natco Crop Health Sciences Limited name. The proposed restructuring is aimed at segregating the agrochemicals business into a separate entity, allowing focused operations and strategic clarity for both segments, potentially helping improve operational efficiencies and enabling better value discovery over the longer term.
The company has faced ongoing challenges with the U.S. Food and Drug Administration (USFDA) concerning its manufacturing facilities. In October 2023, its Kothur plant received a Form 483 with eight observations related to cleanliness, sterility, record-keeping, and quality control. More recently, the Kothur plant was again issued a Form 483 with seven observations in June 2025. The Chennai API facility also received seven USFDA observations in November 2025. These ongoing regulatory compliance issues could complicate product approvals and market access in key regions, potentially affecting investor sentiment.
The company recently secured the Central Drugs Standard Control Organisation (CDSCO) nod for its semaglutide injection and plans to launch the product in the Indian markets in March this year. According to CNBC TV18, shares of the company ended ₹957.90 apiece, up 1.59% on Wednesday, March 18, reflecting positive market sentiment following the board meeting announcement. Since the disclosure was made after market hours, the stock did not react to the development during the trading session. The company operates in a competitive pharmaceutical market alongside rivals such as Sun Pharmaceutical Industries, Dr. Reddy's Laboratories, Divi's Laboratories, and Aarti Industries, all of which must navigate strict regulatory environments where quality and compliance are essential for continued growth and market access.
