Kathmandu: Deurali Janata Pharmaceuticals reported revenue of Rs 1.45 billion during the first nine months of the current fiscal year, as the company moves ahead with an ambitious Rs 5 billion expansion plan to establish a new pharmaceutical plant in Chitwan.
The company generated Rs 1.45 billion in revenue during the review period. In the previous fiscal year, it recorded annual revenue of Rs 2.35 billion, up from Rs 2.02 billion in 2024, Rs 1.86 billion in 2023, Rs 1.70 billion in 2022, and Rs 1.46 billion in 2021.
Revenue grew by 16 percent in the last fiscal year, while the company maintained an operating profit margin of 19 percent. However, during the first nine months of the current fiscal year, revenue declined by 3 percent compared to the same period a year earlier.
Established in 1991, Deurali Janata Pharmaceuticals is considered one of Nepal’s oldest and most established pharmaceutical manufacturers. The company produces more than 250 types of medicines across several therapeutic categories, including cardiovascular care, diabetes treatment, gynaecology and child care, gastroenterology and hepatology, dermatology, and other pharmaceutical products.
The company is now preparing to significantly expand its production capacity by building a new pharmaceutical manufacturing facility in Mangalpur, Chitwan, with an estimated investment of Rs 5 billion.
The project is being structured with a 70:30 debt-to-equity ratio. The company says it is in the final stages of arranging debt financing, although the committed equity portion has not yet been fully injected. Equity investment will reportedly be made gradually during different stages of construction.
Until now, the company has largely relied on internal resources and limited external borrowing for capital expenditure. The upcoming project, however, marks a major shift toward debt-financed expansion over the next two years.
The scale of the proposed investment is substantial compared to the company’s existing asset base. Deurali Janata Pharmaceuticals currently holds fixed assets worth Rs 2.23 billion, meaning the new project would more than double its long-term capital exposure.
The company’s working capital requirements have also risen steadily in recent years, mainly because of slower collection of receivables from the market. According to the company, working capital accounted for 43 percent in 2025 but climbed to 64 percent during the first nine months of the current fiscal year.
The company is primarily owned by Hari Bhakta Sharma, who holds a 71 percent stake, while the remaining ownership is held by members of his family.
Deurali Janata Pharmaceuticals has obtained credit ratings for total borrowing facilities worth Rs 5.29 billion, including Rs 3.45 billion in long-term loans and Rs 1.84 billion in short-term financing. The company plans to raise the entire Rs 3.45 billion long-term debt specifically for the new manufacturing project.
Due to the financial risks associated with the large-scale borrowing, ICRA Nepal has downgraded the company’s credit rating from ‘LA-’ to ‘LBBB+’, citing concerns over rising leverage and the risks tied to the debt-funded expansion.
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