<dhhead>Management Discussion and Analysis</dhhead>
Syngene Overview
Syngene is a contract research, development, and manufacturing services company that offers a broad range of scientific services from the earliest stages of discovery to commercial supplies. This positions the Company as an end-to-end service provider within its sector. With more than 5,600 skilled scientists, advanced technological capabilities and in-depth scientific expertise, Syngene stands out as a preferred partner for biopharmaceutical companies seeking integrated drug discovery, development and manufacturing services. Although its primary focus is on the pharmaceutical sector, Syngene also collaborates with companies in nutrition, animal health, consumer products, and specialty chemicals. The Company has worked with around 400 clients primarily situated in the United States, Europe and the UK.
The drug discovery value chain and Syngene’s role as a service provider (CRO and CDMO)
Syngene provides end-to-end services as a Contract Research Organization (CRO) and Contract Development and Manufacturing Organization (CDMO) for large and small molecules.
As a CRO, the Company offers discovery research services and dedicated facilities which are designed and ring-fenced to meet a client’s exclusive requirements. The dedicated centers house multi-disciplinary scientific teams and essential services with infrastructure tailormade to meet the client specifications.
In Discovery Services, the Company provides end-to-end research services from target selection and high throughput screening to drug candidate delivery for development.
The Company offers different collaboration models ranging from long-term relationships with dedicated R&D facilities to Full-Time Equivalent (FTE) and Fee-for-Service (FFS) arrangements.
As a CDMO, the Development Services division delivers services required for clinical supplies to support clinical trial programs and provides clinical studies relating to safety, efficacy, and tolerability of the chosen drug candidates. Our modern, high performance manufacturing plants for large and small molecules, combined with our expertise in managing products from the early stages of development through to commercial-scale manufacturing, make us an attractive partner for clients seeking a single, reliable provider of services to progress their product to market.
Contract Research Organizations (CRO)
Contract Research Organizations (CROs) provide research services to the pharmaceutical, biotechnology, medical device and other industries in the form of services outsourced on a contract basis.
From basic research to candidate selection, a wide range of activities are outsourced to CROs, including assay development, target validation, lead optimization, genetic engineering, hit exploration and safety and efficacy tests in animal models. The contract research industry has experienced rapid growth over the past decade with the pharmaceutical industry continuing to invest heavily in R&D, with a focus on developing innovative therapies to address unmet medical needs. The pharmaceutical industry is facing increasing pressure to reduce the time and costs associated with drug development. As a result, many companies are exploring new approaches to R&D including the use of digital technologies and collaborations with external partners.
(i) Contract Research Services - market size and attributes
The global CRO market size was valued at USD 23 bn in 2023 and is expected to expand at a CAGR of 10% to USD 37 bn in 20281. The growth of the CRO market is driven by factors such as increasing R&D activities in the pharmaceutical and biotechnology industries, rising demand for outsourcing activities and improving technological capabilities and global expertise.
1. Frost & Sullivan: Independent Market Assessment of the Global and Indian CRDMO Market
(ii) Key industry trends
Continued global demand for R&D outsourcing Biotech funding:
Biotech funding has returned to pre-covid levels but has been unpredictable and CRDMO business recovery remains uneven. We are seeing growing prominence of small-mid biotech players in the drug innovation space, both in terms of number and scale e.g., they are contributing to ~50% of the early-stage assets in the pipeline. Given their focus on science and limited scale in-housethese biotech players are expected to continue to rely heavily on CRDMOs.
Funding slowdown in 2022 and 2023 had pushed biotech companies to prioritize their spending towards development / late-stage assets, as these were most likely to be attractive immediately to potential acquirers. With overall funding in 2024 around pre-Covid levels, its flow towards research and preclinical work are showing signs of gradual recovery, resulting in higher request for proposals and enquiries for CROs. However, the recovery of business has been uneven with many customers taking longer for decision making and looking to commission smaller work packages to prioritize programs and extend cash funds. Biotech funding in Jan-March 2025 was down both y-o-y and sequentially. The pace of recovery in Biotech funding will be a key variable for growth in the CRO segment.
Increased cost pressures for large pharma companies, creating opportunities for CRDMO players
Large pharma companies are seeing increased cost pressures on the back of significant patent cliff and loss of exclusivity (LOE) with substantial revenue from novel biologics and small molecules going off-patent between 2024 and 2028. The need to replace LoE (loss of exclusivity) products and stagnating in-house pipelines is shifting focus for many of the large pharma companies towards acquisitions and partnerships to acquire late-stage assets
Infiation Reduction Act:
IRA (Inflation Reduction Act) which was brought up into US law in 2022 directs US Federal spending towards lowering healthcare costs by authorizing price negotiations for new drugs within US Medicare. It is expected to shorten lifecycle for new drugs by reducing the market price (small molecule to 9 years and biologics to 13 years), thus compressing return periods and hence adding to the margin pressures for the pharma companies. While the pharma companies’ response to IRA is still evolving (e.g., accelerating development programs, rationalizing pipelines, increased outsourcing etc.), there is uncertainty around the severity of the Act’s impact, given the new government’s emphasis to reduce regulatory burden, hence, critical to monitor.
Changes in manufacturing capacity availability on back of acquisitions/consolidation to impact CRDMO demand
The Covid pandemic triggered a spike in capital investment into pharma / biotech companies and in turn into capacity expansion, both Govt and privately funded and led to the rapid building of large vaccine, biologics, Cell & Gene therapy capacity. As the pandemic receded there are many examples of brand new and often unused sites becoming available. The legacy of this is many plants are available for sale, often unqualified and consequently unproven as supply points which may offer great value and opportunities.
Geopolitics and the China+1 strategy, coupled with the BIOSECURE Act, are set to drive a shift in outsourcing geographies Diversification of supply chains
The COVID-19 pandemic and recent geopolitical events have highlighted the risks linked with dependency on a single supply source. Disruptions induced by the pandemic gave rise to supply chain challenges across multiple sectors, including the pharmaceutical industry. Consequently, companies are exploring options for their supply requirements to increase the resilience of their supply chains. This involves diversifying their supplier base to mitigate the risks associated with possible disruptions ensuring uninterrupted continuity of the supply chain.
BIOSECURE ACT passage remains uncertain
Over the last 12 months, the projected beneficial impact of the BIOSECURE Act (introduced in December 2023 in the US Senate) softened with the introduction of an 8-year grandfather clause in May 2024. Though, there is uncertainty about the passage of the Act into law given the recent change in administration and this has not made into the Defence Bill that was introduced in December 2024, we believe pharma companies will start rethinking their CDMO network/footprint with a focus on building a robust China+1 strategy in the medium to long term. To diversify their supply chains, we have witnessed pharma companies do pilots with a select number of CRO companies as a means to test their scientific capabilities. Syngene has been working on pilot projects and has been successful in converting the majority of those pilots into full program contracts, which focus on our core scientific capabilities in synthetic chemistry, drug metabolism and pharmacokinetic studies and assay biology. The pipeline build of new pilot programs is continuing and will flow into 2026.
Indian CRDMO landscape is evolving but faces its own unique challenges
India is strengthening its innovation ecosystem through government initiatives, policy reforms, and developing infrastructure which has the potential to create positive effect on the Indian CRDMO market.
Some of the notable developments are policy interventions for innovation at scale (e.g., the BioE3 Policy, approved by India’s Union Cabinet in August 2024), Government impetus for overall pharma
& API market with ~$3Bn capital outlay with additional ~$600Mn funding for Research and innovation and development of supporting infrastructure e.g., improving biotech infrastructure with emergence of 12 "biotech parks" dedicated to R&D and innovation, 3,500+ biotech startups driving innovation work across modalities (~2k set up within the last 5 years), 25,000+ post-graduates in microbiology added per year with basic capabilities etc.
Indian CRDMO players are moving to capture the outsourcing opportunities with several players raising capital crucial for business expansion, acquisitions, or investment in technology, expanding capacity and building global footprint.
While the India policy landscape is heading in the right direction, a lot of this is still preliminary and not yet actionable. Similarly, the deployment of funds has been slower than originally envisaged, e.g., only ~30% of the funds laid out for pharma and API industry have been disbursed in the last 4-5 years, funding for innovation has not yet been operationalized. In contrast, the Chinese CRDMO landscape is more evolved, bolstered by comprehensive government support and numerous initiatives to foster local innovation
Disruption in technology accelerated by AI
Technological shifts, particularly with predictive and generative AI gaining traction, have the potential to transform the CRDMO industry by driving significant improvement in productivity and scientific outcomes and reducing/eliminating repetitive tasks to improve productivity outside the lab.
In Discovery Research, AI can accelerate and automate processes to enhance in-silico compound screening and bioassays, expediting wet lab processes. While this may reduce research time per molecule, it allows innovators to explore more candidates within the same budget, increasing the overall pipeline for CRDMOs. Additionally, AI can help reduce costs through anomaly detection, facilitating better corrective and preventive actions, and ensuring adherence to good manufacturing practices (GMP) and regulatory requirements.
AI tools can streamline operations, improve resource allocation, and increase overall efficiency, leading to cost savings and better strategic value creation. Additionally, AI-driven tools can significantly optimise corporate / enabling functions
As technology and AI continue to redefine the ways of working, it is important for CRDMO players to build an awareness of the evolving AI capabilities, to pilot and scale new tools as they become available. Further, it is important to understand the long-term evolution of technology and AI and what it could mean for the CRDMO industry.
(iii) Syngene’s Research Services
The Company offers its Research Services through various flexible models, which include shared resources and infrastructure as well as the option of a dedicated facility. The Company has a diversified offering in Research Services including Discovery Services, Dedicated R&D Centres and Clinical Development.
Discovery Services
(a) About the services
As a fully integrated, contract research, development, and manufacturing organization (CRDMO) working across multiple therapeutic areas and modalities, Syngene serves large, midsized, and emerging pharma and biopharma. Over the last several years, the requirements of our clients have evolved from seeking solely the benefits of strong technical execution in a low-cost operating region to additionally choosing to externalize collaboration and innovation. We further observe that our clients are often opting for the benefits of co-localization of critical path activities (e.g. synthesis, biological and PK/ADME characterization), as well as those from the ability to advance programs through downstream services (e.g. safety assessment, drug substance and drug product development).
During the recent period of geopolitical and financial uncertainty, many of our clients have opted to derisk their external operations, both through geographic diversity (e.g. China + India) and through the development of strategic partnerships with a limited number of CROs/CDMOs, rather than source capabilities across a broader network. This presents important growth opportunities for organizations featuring a breadth of integrated services.
In this context, Syngene has recently realigned our Operating Units responsible for technical delivery to a structure we feel best enables us to meet or exceed customer requirements and expectations. The newly formed Research Services division comprises the legacy Discovery Services operating units of Discovery Chemistry, Discovery Biology, Safety Assessment, and Computational & Data Sciences, as well as the special business unit of SynVent (expert led, integrated therapeutic discovery). Research Services additionally includes Translational & Clinical Research, as well as three dedicated centers for the clients Bristol Myers Squibb, Amgen, and Baxter. The remaining two technical divisions are the large and small molecule CDMOs, LMCDMO and SMCDMO, respectively.
(b) Syngene’s strategy
The primary focus of Research Services is on human and animal health, noting we provide additional services in scientific adjacencies, including agricultural chemicals, consumer products, and material sciences. Our core market differentiation strategy is therefore to provide comprehensive, end-to-end therapeutic discovery, preclinical, and clinical development capabilities spanning all associated disciplines, disease areas, and therapeutic modalities.
Research Services delivers high-value innovation through its core scientific capabilities and specialty platforms. A key priority is ensuring world class productivity through investment in digitization and automation. We furthermore aim to retain clients through the downstream stages of development and manufacturing by offering rapid transitions at every stage in the value chain.
(c) Progress made during the year
Research Services continued to strengthen the end-to-end suite of capabilities to support client projects through the entire discovery and preclinical/clinical development paradigm for the range of modalities, including traditional small molecules, specialty chemistry platforms such as peptides, oligonucleotides, and PROTACs, as well as biologics, therapeutic antibodies, antibody-drug conjugates (ADCs), and cell and gene therapy. This included investments both in new and enabling technologies to strengthen technical delivery, as well as robotics and automation to drive speed and efficiency at scale.
To enhance and simplify the customer experience, during Q3 we launched Phase 1 of Syne-MAP,a proprietary B2B ecommerce platform, which allows clients to explore available biological assays, configure services, and place orders online, enhancing collaboration timelines and efficiencies. This phase included comprehensive access to our Drug Metabolism and Pharmacokinetics (DMPK) offerings. The portal allows clients to view protocols, request studies, and receive data. Subsequent stages will extend this online portal to service offerings in other Research Services departments.
Throughout FY25, Research Services enabled several clients to achieve key milestones. Within Syngene SynVent™ specifically, five of five planned candidate selections were achieved. Syngene scientists were listed as co-inventors in nine patents.
(d) Capability and capacity additions during the year
Q1 of FY25 was marked by the start of several pilot projects for pharma clients exploring outsourcing options beyond China. Successful delivery of these projects will build a foundation for larger scale future collaborations.
he Company continued to add capacity and capabilities in Discovery Services at its Bangalore and Hyderabad campuses in areas such as antibody-drug conjugates, peptides and oligonucleotides.
Within Research services, Syngene continued to receive pilot projects from large and medium sized pharma companies and successfully converted majority of these programs into full-fledged contracts.
Continued technology upgrades and automation in its operations to enhance scientific excellence:
a. Integration of advanced automation with the DMPK operations. The initial implementation of these upgrades has heightened speed, consistency and efficiency.
b. Introduced SYNe-MAP™, a proprietary B2B ecommerce platform, which allows clients to explore available biological assays, configure services, and place orders online, enhancing collaboration timelines and efficiencies.
Dedicated R&D Centers About the centers
The Dedicated R&D Centers offer a "turn-key" solution to clients, essentially the equivalent of their own research site in India and scalable from a partial floor to multiple buildings. These centers are tailored to provide everything required to advance the client’s projects, including highly trained scientific personnel, management, infrastructure, operating systems, and standardized processes and procedures in compliance with regulatory requirements. Clients operating within this model can readily access additional Syngene services as required.
The facilities are usually part of long-term strategic partnerships for five years or longer. Client representatives are co-located in the Dedicated Center premises, thereby creating a truly collaborative environment with real-time and continuous exchange of ideas which fosters creativity and learning for all stakeholders
(i) Syngene’s strategy
Extend and expand the dedicated R&D centres
The Company remains focused on continuing to strengthen the existing partnerships with Dedicated Center clients. Such partnerships provide revenue visibility over the medium to long-term with predictable cash flows. The Company is also exploring opportunities to expand the partnerships with these clients beyond the dedicated center model.
Progress made during the year
Revenue from Research services (Dedicated Centers+ Clinical Development + Discovery Services) – increased by 2% compared with last year. While Dedicated Centers grew at a steady pace, Discovery services registered growth on the account of conversion of pilots and capacity ramp up by existing clients in second half of FY25, First half was impacted by the slow down in biotech funding in the US resulting in spend optimization by clients. The contribution to total Syngene revenue from Research Services was at approx. 61% for the year similar to previous year.
Overall outlook for Research Services:
The year was challenging for the research services industry as a whole as US biotech funding remained uncertain and delays around USA BIOSECURE ACT impacted client spending on research projects. In addition, biopharma companies continue to restructure with layoffs and site closures. However, with our diversified and resilient research business, Syngene grew in the second half of the year after a challenging first half
With increasing R&D spend and propensity to outsource by our clients, we believe that the long term growth drivers for the industry are intact. Furthermore, India’s concerted effort to position itself as an attractive outsourcing destination, coupled with a strategic drive to increase supply chain resilience, may yield long-term advantages. While short-term challenges may arise due to funding issues or pharmaceutical companies focusing their efforts on late-stage pipeline projects, the sustained investment in pipeline development is expected to persist in the long run.
Throughout FY26, Research Services will continue to enhance and expand our service offerings through further investments in both key technical talent and enabling technologies. We will continue to make technology upgrades in research services to enhance scientific excellence, improve competitive positioning and deliver customer value. The Company will is focused on implementing operational improvements to enhance customer centricity, automate processes and drive a culture of continuous improvement resulting in improved performance at a reduced cost base. We will invest in building differentiating technologies such as ADC, peptides which are witnessing high growth.
We expect growth trajectory to continue in FY26 with diversified research business model across Discovery Services, Dedicated Centers and Clinical Development. Conversion of pilot projects and improved biotech funding will be key levers of growth.
In the dedicated centers, the Company will continue to focus on the needs of its long-term strategic partners through investment in new capabilities and continuous improvement in services.
Contract Development and Manufacturing Services (CDMO)
CDMOs specialize in the development, scale-up and manufacturing of drug products for clinical trials and commercial distribution. They offer a range of services that include drug development, process development, analytical testing, formulation development, scale-up, manufacturing, packaging and distribution. These services can be provided on a stand-alone basis, or as part of a complete end-to-end service offering.
(i) Contract development and manufacturing services – market size and attributes
The global CDMO market (comprising small and large molecules) was valued at USD 120 bn in 20231 and is expected to grow at a CAGR of 8% to reach a market size of USD 176 Bn in 2028. Strong technical and R&D infrastructure capabilities, availability of skilled scientific talent and quality manufacturing with strong track record of regulatory compliance, are some of the key success factors for a CDMO. The reliance on CDMOs will further increase going forward as they continue to offer innovator pharmaceutical companies commercially feasible solutions for a range of drug development and manufacturing services, such as pharmaceutical formulation, analytical development, process optimization, and scale-up manufacturing.
1. Frost & Sullivan: Independent Market Assessment of the Global and Indian CRDMO Market
(ii) Small molecule development and manufacturing services market
A typical small molecule CDMO offers services in clinical scale drug substance and drug product development, clinical scale manufacturing services and commercial scale development and manufacturing services.
In the CDMO industry, small molecules currently dominate the industry with 80%+ proportion, as they can target a wide range of diseases and disorders and remain a fundamental component of pharmaceutical markets. With increase in outsourcing and growing complexity and diversity of small molecules, SM CDMO industry is expected to grow at rate of 6.8% during 2023-28 to reach a $137 Bn by 20282.
2. Frost & Sullivan: Independent Market Assessment of the Global and Indian CRDMO Market
(iii) Large molecule development and manufacturing services market
The large molecule market size is currently estimated at USD 22 bn3 and is forecast to grow at a CAGR of 12% to reach the market size of USD 39 bn in 20283.
Drug development for large molecules can be divided into two sections: drug substance (DS) development, which includes the development of master and working cell banks, manufacturing process development, and scale-up; and drug product (DP) development, which includes filling the drug substance into the primary containers.
(iv) Syngene’s development and manufacturing services Small Molecule CDMO Services:
We restructured our operating model with the integration of small molecule development and manufacturing into a single division. It now mirrors how our clients approach their commercial manufacturing requirements. To support this, we consolidated our drug substance (DS) and drug product (DP) salesforce, strengthened our leadership team with step up hires.
We revamped the operating model to adopt a "follow-the-molecule" approach, thereby enhancing our operational effectiveness.
In Small Molecule CDMO Development Services, Syngene offers preclinical development, API and drug product development. We engage in drug development services from lead generation to clinical supplies of drug substance and drug product. We also support our clients in drug filing with US FDA and other regulatory authorities.
The Company has an integrated small molecule offering including process development, nGMP supplies and clinical and commercial supplies. The Company has a state-of-the-art small molecule commercial manufacturing facility in Mangalore which has successfully completed the US Food and Drug Administration (US FDA) approval, an important building block for the company’s small molecule commercial manufacturing strategy.
Syngene offers current Good Manufacturing Practices (cGMP) manufacturing from benchtop volume to commercial scale as well as end-to-end solutions from GLP-Tox batches to clinical supplies, scale-up, launch and commercial manufacturing
Syngene’s Small Molecule CDMO Services strategy
We aspire to be a mid-scale player in the small molecule with depth/ differentiation in select technologies of the future. This strategic positioning will enable us to differentiate and offer value-added services with meaningful scale and favorable unit economics. Additionally, it allows us to avoid over-investing in costs or any single specialized area, ensuring balanced growth and sustainability.
One of the key considerations for the success of our SMCDMO business is to have the right scale. We will look for strategic options to enhance scale for our small molecule business which makes it attractive for commercial innovators who are looking for reliable long term supply sources.
Over the strategic period, we plan to expand our Total Addressable Market (TAM) by enhancing our focus on small-mid biotech to expand further on early-stage development projects and strengthen the large pharma projects to build further on "follow-the-molecule approach. We will achieve this by strengthening our Go-To-Market with a sharper value proposition for each customer cohort and improved productivity per BD. We will also invest in a select set of new technologies including peptide/oligos to build a scalable and differentiated business
Progress made during the year /Capability and capacity additions:
The changes in our operating model, commercial setup, and focus on operational improvement are showing early positive impact such as increase in win rates, stronger pipeline of projects which has the potential to advance from development to late stage, scaled the process development pilots and increased capacity utilisation
We continue to focus on offsetting operating costs by utilizing development capacity, including working on multiple small scale development stage projects. The business is long cycle, and such projects help us build client interest and strengthen credibility.
We demonstrated our scientific excellence leading to enhanced yields, resolution of complex issues, successful crystallization, and delivery of complex dosage forms for multiple clients.
In the financial year 2025, our primary focus was on expanding capabilities through modifications to existing facilities, the construction of new ones, and strengthening our team by bringing in subject matter experts for emerging modalities. We also concentrated on streamlining documentation processes to ensure timely deliveries while maintaining regulatory and compliance standards. FY25 was marked with increase in PRD projects in first half of the year.
A new, dedicated laboratory for the synthesis of potent molecules has been established. A state-of-the-art facility for handling molecules under OEB-4 conditions has been set up at the mangalore site.
Revenue from SM CMDO declined by 24% Y-o-Y with the contribution to revenue going down to 12% in FY25 from 16% in FY24.
Outlook for Small Molecule Development and Manufacturing Services:
SMCDMO is an attractive space to be in with two key drivers fueling this growth including pressure on large pharma to accelerate development efficiently and lower costs, driving greater CDMO reliance, and the emergence of new technologies with a growing asset pipeline that favor outsourcing and promise higher profitability due to specialized skill requirements.
This growth will be primarily driven by a strong focus on enhancing operational performance and service improvements within our core business unit. We are also evaluating scaling our operations through capacity expansion and strategically entering new segments such as ADC and oligonucleotides. These efforts will strengthen our market position and create new sources of differentiation.
Large molecule development and manufacturing services
The Company is a fully integrated custom biomanufacturer. Our solutions include mammalian and microbial capabilities for clinical and commercial supplies. We have a strong track record in terms of experience and know-how across monoclonal antibodies, bispecific, antibody fragments, recombinant proteins, glycoproteins, mRNA, microbial (E. coli and Pichia) and microbiome Live Biotherapeutic Product (LBP).
Our biologics manufacturing facility can accommodate multi-product production campaigns simultaneously, based on a single-use technology platform. It is designed to support clients during long-term commercial manufacturing campaigns. Our facility has a wide range of the latest technology combined with rich experience in handling cell culture-based products.
(a) Strategy: Provide end-to-end solutions for development and manufacturing
The Company aims to enhance the business through further improving Syngene’s biologics brand and commercial reach in human and animal health. Syngene acquired Stelis Unit 3 and recently entered the US market through the acquisition of the Emergent Baltimore facility – and the focus now is to build a pipeline of projects that generate recurring revenue & expand our integrated development pipeline to feed future commercial launches and operationalize Unit -3 and USA Biologics facility
We intend to expand the portfolio in new growth areas by continuing progress in niche microbial and emerging Advanced Therapy Medicinal Products (ATMP) areas, expand portfolio with capability investments including ADC market via investment in commercial scale bioconjugation capability and drug product market.
We will continue to expedite building our capabilities and focus on efficiencies (reduce $/g costs via technology advancements, digitization, operational excellence)
(b) Progress made during the year/ Capability and capacity additions Syngene acquired its first biologics site in the USA – fitted with multiple monoclonal antibody (mAbs) manufacturing lines. The state-of-the-art biologics facility, acquired by Syngene USA Inc., a wholly owned subsidiary of Syngene, from Emergent Manufacturing Operations Baltimore, LLC (a subsidiary of Emergent BioSolutions Inc.), will expand Syngene’s growing global biologics footprint to better serve its customers across both human and animal health market segments. It enables Syngene to expand its footprint in the largest US market and comply with requirements of clients looking for USDA approvals for their products. The new site will increase Syngene’s total single-use bioreactor capacity to 50,000L for large molecule discovery, development, and manufacturing services. Additionally, it will provide Syngene’s customers with continuity of supply from its four development and manufacturing facilities located in India and North America, offering services ranging from cell line development, process optimization and both clinical and commercial supply.
• During the year, the Company introduced a protein production platform, which reduces development timelines by months for a variety of biologics - including monoclonal antibodies, biosimilars, antibody drug conjugates and other recombinant proteins - gaining time for clients and enabling medicines to reach patients more quickly.
• Syngene progressed with repurposing the biologics manufacturing facility (Unit III) acquired in FY24. The facility has received local regulatory approvals during the year. In addition to single-use bioreactors, the plant includes a development suite for the clinical supply of drug substances and two high-speed vial filling lines. The facility offers plug-and-play manufacturing platforms, which can be customized and tailored to meet customer needs.
• During the year, Syngene achieved a milestone by becoming the first company in the Indian pharma and life sciences industry to earn the 5S certification (5S is a cyclical methodology: sort, set in order, shine, standardize, sustain the cycle) for the biologics quality control laboratory. Awarded through a joint evaluation by the Union of Japanese Scientists and Engineers (JUSE) and the Quality Circle Forum of India (QCFI), the certification recognizes Syngene’s laboratory designs and practices, which have led to better workplace organization, increased productivity, enhanced safety, improved quality control and fewer errors
• We have been investing in building our commercial teams closer to client locations. Our investment in expanded commercial resources is paying with the increase in amount of new business compared to previous years driven by enhanced strategic marketing focused on targeted customer segments with clear segment and investment in enhanced sales training to establish a common value selling process.
Overall, Large Molecule Development and Manufacturing Services revenue grew by 22% with share of revenue increasing from 21% in FY24 to 25% in FY25
Outlook for Large Molecule Development and Manufacturing Services:
LM-CDMO market dynamics remain attractive and Syngene is well positioned to take advantage of the market growth.
Syngene has invested in capacities both in India and the US and recent capacity additions including USA presence gives growth headroom in an attractive growing global market. The Company is also working on early-stage integrated development projects which have t6eh potential to feed into later stage clinical/ commercial programs.
US entry is essential to maintaining our leading position in Animal Health. It opens up access to a new and sizable customer segment (US customer who only outsource domestically) and is a critical factor in delivering near term and long-term revenue due to client interest we are witnessing.
The business will transition from a regional supplier to one that operates a global network capable of addressing every Human and Animal Health customer with a value proposition that provides flexibility to the customer seeking both speed to market and cost competitive on a global scale. Adding Drug Product capability and augmenting the core business with new market entry opportunities will provide ‘one stop & integrated solutions’ further diversifying the biologics portfolio in targeted areas that exceed the core market growth rates.
Essential Functions Quality:
Over the past year, Syngene made significant progress in digital transformation, regulatory compliance, facility expansion, and operational excellence. Key digital initiatives included the implementation LIMS upgrades for paperless lab operations, and RealWear hands-free devices for virtual audits. Additionally, a Scientific Data Management System was introduced to integrate multiple lab instruments on a single digital platform, and predictive analytics-powered dashboards were deployed for GMP QC lab scheduling and planning.
On the regulatory front, Syngene secured CDSCO approval for the S19 Raw Material (RM) lab, enabling in-house testing and GMP raw material release, thereby reducing reliance on outsourcing. The Biologics QC unit became the first Pharma and Life Sciences company to receive the prestigious 5S Certification from JUSE (Japanese Union of Scientists and Engineers) and QCFI (Quality Circle Forum of India), reaffirming Syngene’s commitment to quality and operational excellence. The unit also won the Platinum Award at the 19th CII Edition for reducing testing turnaround time and improving productivity.
Facility expansions included commissioning the IPQC and microbiology labs in Stelis Unit 3 (SU3), repurposing the SU3 drug substance facility for mAb production, and installing OEB IV-compliant equipment at MSEZ for potent product handling. The BMP5 facility at SU3 was also commissioned for routine production. Technological advancements strengthened Syngene’s analytical capabilities with the integration of SEC-MALS, Spectramax i3x, iCE, and CE systems.
Furthermore, four Green Belt projects led to a 15% cost reduction, improved audit scores, and a decrease in LIR and human errors. The year also marked the digitalization of microbiology sample analysis, reinforcing Syngene’s focus on innovation, efficiency, and regulatory excellence.
IT
In the past year, the IT department has undertaken several key initiatives that have significantly enhanced operational efficiency, streamlined processes, and improved overall productivity across the organization. IT investments in automation and digitization continue to enhance productivity, efficiency, and business agility across scientific and enterprise functions. Our IT strategy follows a business-driven, IT-enabled approach, ensuring alignment with organizational goals while delivering value to our customers.
We refreshed our IT strategy to boost digital capabilities and future-proof operations. To drive structured AI adoption, pilot high-impact use cases, and scale successful solutions, thus enhancing productivity, decision-making, and innovation.
In FY25, we initiated several key projects. Project VEGA is a multi-year transformation initiative aimed at automating and integrating core business processes—from lead generation to revenue collection. By embedding intelligence and enhancing process controls, it boosts efficiency, transparency, and agility.
Project VEGA Phase 1 focused on strengthening digital integration, with the Biologics team (BMP1) adopting MRP for demand planning, replacing manual methods. Integration with smart dashboards improved accuracy and led to significant inventory savings. As a result, the project attributed to savings IT initiatives amounted to INR 5 crore, while the total savings for the organization reached INR 10 crore. Additionally, the project helped in reducing the Days of Inventory Outstanding (DIO) from 198 days to 138 days, further contributing to cost savings and improved resource utilization.
The new Contract Lifecycle Management (CLM) system, integrated with enterprise platforms, streamlines contracts, enhances compliance, and increases efficiency. The d-VEGA module simplifies the lead-to-opportunity process, with process mapping and blueprinting complete, and implementation underway.
Project VEGA Phase 2 involves setting up a Data Management Office (DMO) to ensure data accuracy, consistency, and integrity across functions, supporting a smooth SAP S/4HANA and SAP Ariba transition.
In Clinical Development, we enhanced LIMS capabilities for pathological testing, ensuring better data management and compliance.
We also established a Digital Infrastructure Layer to support various technological advancements, enhancing operational efficiency and scalability. The adoption of electronic Batch Manufacturing Records (eBMR) for Biologics and Chemical divisions improved accuracy, data integrity, and regulatory compliance.
We also focused on enhancing information security across Syngene by establishing the Information Security Working Group (ISWG) to strengthen cybersecurity and data protection. Since October 2024, ISWG has improved security policies, risk assessment, and cybersecurity awareness, aligning with ISO 27001:2022 standards and enhancing Data Loss Prevention (DLP) policies. Syngene International Ltd. is now ISO 27001:2022 Certified.
In Discovery Services, we optimized inventory management by implementing an Inventory Dashboard for real-time stock visibility, improving tracking, forecasting, and procurement while reducing stockouts, excess, and costs. At Syngene Unit-III, initiatives to boost manufacturing efficiency through IT-OT integration and AI-driven predictive maintenance were launched, enabling seamless data flow, fault detection, and reduced downtime.
To enhance quality control, we launched a Quality Control Planning and Scheduling Tool (Beta) to replace manual planning with a real-time dashboard, improving lab efficiency by tracking sample availability, analyst workload, turnaround times, and productivity, with automated alerts for deviations.
To improve employee experience, we continuously invested in upgrading HR processes, covering the entire employee lifecycle from hire to retire. The implementation of SAP SuccessFactors, including modules like Employee Central and Succession Planning, empowered employees with self-service capabilities and streamlined HR operations.
As part of AI Adoption, we rolled out Microsoft Co-Pilot to deliver AI-powered support across M365 apps, with leadership training enabling effective adoption. The adoption of Microsoft Copilot boosted productivity by automating repetitive tasks. Attendance management was automated using Robotic Process Automation (RPA), cutting processing time by 53% and improving accuracy and compliance.
Strengthening IT infrastructure for performance, resilience, and safety included implementing a One-Click Disaster Recovery system, achieving a 15-minute Recovery Point Objective (RPO) and a 2-hour Recovery Time Objective (RTO), ensuring swift recovery and minimal disruption during system failures.
These initiatives collectively contributed to a more efficient, resilient, and innovative organization.
Strategic sourcing
Over the past year, strategic sourcing remained strong despite geopolitical tensions and global disruptions. This was driven by our multi-supplier network and a strong local supply ecosystem.
To support Syngene’s growth, we expanded our category expertise and capabilities while maintaining a strong focus on ESG and compliance. Our goal was to build a future-ready supply chain that meets evolving customer needs.
In discovery services, there was an increase in catalogue chemicals procurement from local warehouses and the development of alternate sourcing for critical materials, improving delivery timelines and ensuring business continuity. Our Key Starting Material (KSM) supplier network in India expanded with a focus on specialized chemistries, reducing dependency on China in our small-molecule development services. In Biologics, we continued our focus on cost competitiveness and strengthening supply assurance from our global suppliers.
Our Annual Supplier Summit in November 2024 brought together 50+ strategic suppliers with theme of fostering a strong local sourcing ecosystem. We also set science-based Scope 3 emission targets (approved by SBTi), engaged with top-emitting suppliers, and upskilled internal teams, equipping them for the next level of engagement. Additionally, we secured supplier partner membership with PSCI, an association of leading pharmaceutical companies, further strengthening our commitment to sustainable and responsible sourcing.
Operational excellence
At Syngene, operational excellence is deeply ingrained in our daily operations, with leaders at every level driving continuous improvement. Our core values—safety, quality, and integrity—form the foundation of everything we do. We leverage Lean and Six Sigma methodologies to eliminate waste and enhance efficiency across all functions.
This year, we made significant strides in strengthening our systems and processes. Through the Lean Six Sigma Academy, we trained 35 Black Belts, 109 Green Belts, 120 Yellow Belts, and 1,400+ White Belts, ensuring 99% of employees are certified at the White Belt level. Our 5S implementation established a well-organized and efficient workplace, earning JUSE-QCFI certification in December 2024, making Syngene the first company in the pharma and life sciences sector to achieve this milestone. Employees contributed 2,600+ Kaizen ideas, driving innovation and continuous improvement.
Our SQDECC (Lean Daily Management System) further enhanced operational efficiency by focusing on Safety, Quality, Delivery, Engagement, Compliance, and Cost, with 80+ SQDECC boards actively driving performance across the organization.
Our commitment to operational excellence has been recognized at both national and international levels, earning 41 awards from prestigious organizations such as ASQ, CII, and QCFI. Our Kaizen case study on Sustainability for Hazardous Waste Management through Co-processing was presented at ICQCC-2024 in Colombo, Sri Lanka, where it won the highest Gold award.
These achievements reinforce our unwavering dedication to fostering a culture of continuous improvement and operational excellence at Syngene.
Human Resources
Syngene continues to thrive with a highly skilled, science-driven workforce, with scientists representing 88% of our team. This year, we expanded our talent development framework through two key programs: the Accelerated Leadership Program (ALP), an 18-month Management Trainee initiative launched in July 2024 with its first cohort of 5 trainees from leading business schools, and the Graduate Accelerator Program (GAP), a new 6-month intensive onboarding for STEM postgraduates. Alongside these programs, we continue to recruit both seasoned industry professionals and fresh graduates, ensuring a robust talent pipeline. The Syngene Training Academy (STA) remains foundational, equipping all new joiners with the technical and professional skills needed to excel in industrial research.
My Future Plan is now fully embedded in our culture, driving meaningful performance and career discussions across all levels. This framework has transformed talent development, providing clear growth pathways while aligning individual aspirations with organizational goals.
Building on our commitment to employee wellbeing, we launched Thrive360, a holistic program addressing physical, mental & emotional, financial, social, workplace & culture and professional wellbeing. Initiatives under this umbrella - including enhanced benefits, mental health support (extending to families), and upgraded policies - have been well-received, contributing to a more engaged and resilient workforce.
Our pulse Employee Experience Survey continues to guide workplace enhancements, ensuring we remain responsive to our workforce’s evolving needs. Together, these initiatives solidify Syngene’s reputation as a premier scientific employer, fostering both individual growth and sustainable success.
FY25 Financial Performance
The consolidated financial performance of the Company for FY25 (in Rs Mn) is discussed below.
Particulars |
FY24 |
FY25 |
Change (%) |
Revenue from operations |
34,886 |
36,424 |
4% |
Other income |
906 |
718 |
-21% |
Reported revenue |
35,792 |
37,142 |
4% |
Costs of chemicals, reagents and consumables consumed |
9,302 |
9,425 |
1% |
Employee benefits expense |
9,699 |
10,792 |
11% |
Other expenses |
5,183 |
5,770 |
11% |
Foreign exchange fluctuation gain/(loss), net |
-558 |
-19 |
-97% |
EBITDA |
11,050 |
11,136 |
1% |
Depreciation and amortisation expenses |
4,259 |
4,326 |
2% |
EBIT |
6,791 |
6,810 |
0% |
Finance costs |
472 |
531 |
13% |
PBT |
6,319 |
6,279 |
-1% |
Tax |
1,133 |
1,530 |
35% |
PAT before exceptional item |
5,186 |
4,749 |
-8% |
Exceptional item (refer note 1) |
-86 |
213 |
-348% |
PAT after exceptional item |
5,100 |
4,962 |
-3% |
Other comprehensive income for the year |
1,426 |
-147 |
N/a |
Total comprehensive income for the year |
6,526 |
4,815 |
-26% |
FY25 financial performance includes the following adjustments:p>
Note 1. Exceptional item (net of tax) in FY24 pertains to transaction costs relating to the acquisition of the multi-modal facility from Stelis Biopharma Limited. For FY 25 pertains to insurance claim received on account of fire incident which took place on 12 December 2016, for the loss of fixed assets.
Particulars |
FY24 |
FY25 |
Change (%) |
Revenue from operations |
34,886 |
36,424 |
4% |
EBITDA from the operations |
10,144 |
10,418 |
3% |
Reported PAT before exceptional items |
5,186 |
4,749 |
-8% |
Reported PAT (After exceptional items) |
5,100 |
4,962 |
-3% |
Revenue
Revenue from operations increased by 4%, from Rs Rs 34,886 Mn in FY24 to Rs 36,424 Mn in FY25. This growth was driven by strong performance in Large Molecule business driven by commercial revenues and PRD projects from other clients. Research Services remained stable, contributing to 61% of the total revenue, consistent with last year. Challenging funding environment for US Biotech companies impacted the demand growth in Discovery Services leading to slower overall growth compared to the previous year..
Syngene’s approach of building robust and diversified business model across the CRO and CDMO services, along with a strong focus on execution, enabled the Company to be resilient during the period.
Other income for the period decreased by 21% to Rs 718 Mn. Other income decreased due to lower cash balance as a result of acquisition of Stelis Unit 3.
Including the other income, total revenue growth for the year was at 4% year on year, increasing from Rs 35,792 Mn in FY24 to Rs 37,142 Mn.
Cost of materials consumed
The cost of materials consumed in FY25 increased by 1% to Rs 9,425 Mn, accounting for 26% of revenue from operations less than 27% of revenue in FY24. Raw material cost as a percentage of revenue improved in FY 25 compared to FY 24 driven by change in business mix and improved yield in biologics. Employee benefits expense The employment costs was Rs 10,792 million during the year reflecting an increase of 11%. Employee cost-to-revenue ratio increased from approximately 28% in FY24 to 30% in FY25 attributable to yearly increments and leadership hiring. Other expenses Other expenses recorded a 11% rise compared to the previous year, attributed to investments in commercial team, digital/automation initiatives and repair and maintenance costs. Partially offsetting this increase were reduced direct costs, primarily in power and utility expenses, which demonstrated a year-on-year decline. This favorable trend is indicative of reduced utility input costs and an uptick in the utilization of green energy across our facilities. Foreign exchange _uctuation The Company made an exchange loss of Rs 19 Mn during FY25 as against an exchange loss of Rs 558 Mn in the previous year. The loss was largely on account of the hedge rates being lower than the prevailing market rates.
Depreciation and amortisation expense
Depreciation and amortization increased to Rs 4,326 Mn from Rs 4,259 Mn in FY24. This is driven primarily by asset additions over the last 12 months and new building leases entered during the period.
Finance costs
The Finance costs increased by 13% to Rs 531 Mn in FY25 compared to Rs 472 Mn in FY24 due to interest component of lease liabilities on new properties taken on lease.
Tax expenses
Tax expenses for the year increased from Rs 1,133 Mn to Rs 1,530 Mn in FY25. Reported PAT before exceptional items for the year was down 8% to INR 475 crores.
Profitability
The Company’s reported Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) in FY25 grew by 1% from Rs 11,050 Mn in FY24 to Rs 11,136 Mn in FY25.
EBITDA margin for the year was at 30.0% compared to 30.9% in FY24.
Excluding other income, EBITDA from operations increased from Rs 10,144 Mn in FY24 to Rs 10,418 Mn in FY23, an increase of 3% year-on-year, resulting in a margin of 28.6% of revenue from operations for the year as compared to 29.1% in the previous year.
Profit After Tax before exceptional items decreased by 8% from Rs 5,186 Mn in FY24 to Rs 4,749 Mn in FY25. Adjusting for exceptions, report PAT decreased by 3% from Rs 5,100 mn in FY24 to Rs 4,962 mn in FY25.
Other Comprehensive Income
Other comprehensive income includes re-measurement gains/losses on defined benefit plans and gains/losses on hedging instruments designated as cash flow hedges. The decrease/increase is primarily due to mark-to-mark gain/loss on the hedge instruments.
Analysis of the Consolidated Balance Sheet: The following table exhibits the Company’s balance sheet as on 31st March, 2025 and 31st March 2024: (in Rs Mn)
31 Mar 2024 |
31 March 2025 |
Change (%) |
||||
ASSETS |
||||||
Non-current assets |
||||||
Property, plant and equipment |
23,783 |
23,226 |
-2% |
|||
Capital work-in-progress |
8,368 |
12,614 |
51% |
|||
Right-of-use assets |
4,024 |
4,192 |
4% |
|||
Investment property |
411 |
343 |
-17% |
|||
Other intangible assets |
282 |
256 |
-9% |
|||
Intangible assets under development |
13 |
47 |
262% |
|||
Financial assets |
2,578 |
2,521 |
-2% |
|||
Deferred tax assets (net) |
407 |
295 |
-28% |
|||
Income tax assets (net) |
1,923 |
1,243 |
-35% |
|||
Other non-current assets |
137 |
349 |
155% |
|||
Total non-current assets |
41,926 |
45,086 |
8% |
|||
Current assets |
||||||
Inventories |
2,385 |
1,555 |
-35% |
|||
Financial assets |
16,083 |
20,018 |
24% |
|||
Other current assets |
1,122 |
1,300 |
16% |
|||
Total current assets |
19,590 |
22,873 |
17% |
|||
Total assets |
61,516 |
67,959 |
10% |
|||
EQUITY AND LIABILITIES |
||||||
Equity |
||||||
Equity share capital |
4,020 |
4,025 |
0% |
|||
Other equity |
38,557 |
43,243 |
12% |
|||
Total equity |
42,577 |
47,268 |
11% |
|||
LIABILITIES |
||||||
Non - current liabilities |
||||||
Financial liabilities |
4,651 |
4,106 |
-12% |
|||
Provisions |
407 |
433 |
6% |
|||
Other non-current liabilities |
2,438 |
2,188 |
-10% |
|||
Total non-current liabilities |
7,496 |
6,727 |
-10% |
|||
31 Mar 2024 |
31 March 2025 |
Change (%) |
||||
Current liabilities |
||||||
Financial liabilities |
4,131 |
5,971 |
45% |
|||
Provisions |
727 |
713 |
-2% |
|||
Current tax liabilities (net) |
476 |
84 |
-82% |
|||
Other current liabilities |
6,109 |
7,196 |
18% |
|||
Total current liabilities |
11,443 |
13,964 |
22% |
|||
Total equity and liabilities |
61,516 |
67,959 |
10% |
|||
Non-current assets
The increase in non-current assets as company continued to add capacity and capabilities in Discovery Services at its Bangalore and Hyderabad campuses in areas such as antibody-drug conjugates, peptides and oligonucleotides. Other investments were made in Development and Manufacturing Services, including the acquisition of Biologics facility in Baltimore, USA and additional capabilities for the small molecule business.
Working Capital (Current assets, less current liabilities)
Working capital increased from Rs 8,148 Mn in FY24 to Rs 8,909 Mn in FY25. This increase is attributable to increase in current assets led by investments in financial assets.
Equity share capital
The Company’s equity share capital comprises of approximately 403 million equity shares of Rs 10 /- each.
Other equity
Other equity comprises the share premium, retained earnings, cash flow hedging reserves and other reserves. The total reserves and surplus of the Company increased by 11% in FY25 as a result of the accumulation of profits earned during the year and the movement in items of other comprehensive income.
Non-current liabilities:
Non-current liabilities decreased by 10% led by decline in long term borrowings and other liabilities.
The debt: equity ratio of the Company as on 31 March 2025 is almost negligible (0.03) similar to 0.03 on 31 March 2024 .
Net Cash position:
Taking into account investments in inter-corporate deposits with financial institutions, deposits with banks, cash and cash equivalents and investments in overnight mutual funds, the Company is net cash positive as of 31 March 2024. The net cash position increased from Rs 9,353 Mn as of 31st March 2024 to 12,794 Mn in FY25.
RISKS, CONCERNS AND MITIGATION STRATEGY Risks and Concerns
Risk Management is an integral part of management practice in the Company and is correlated with the execution of its strategic priorities. An Enterprise-wide Risk Management framework provides a holistic approach to identification, monitoring, reporting and mitigating risks that could impact performance. Risk mitigation is reviewed regularly under a governance process involving the Executive Risk Committee and the Risk Management Committee under the Board.
The Executive Risk Committee assesses the probability, velocity and severity of all enterprise risks. Emerging risks are identified and discussed with the risk committees along with the mitigation action plan. Every enterprise risk has an identified risk owner from the Executive Committee and the risk owner, in addition to providing a quarterly update on the mitigation status, also leads a full risk review once a year with the Risk Management Committee under the Board.
Our Risk Management framework is aligned with Business Continuity Planning which is essential for organizational resilience. This framework encompasses proactive identification, assessment, mitigation, and monitoring of risks and disruptive events across all business operations minimizing the impact on business and stakeholders. Alignment of the risk management framework and business continuity planning fosters a culture of preparedness, enhances decision-making during crises, and safeguards continuity of critical business functions.
The Enterprise Risk Management framework is aligned to SEBI regulations and risks have been categorized into sectoral, operational, financial, and information/cyber security risks. In line with the strategy update five additional risks were identified and have been included in the table below.
The following table provides a summarized view of the major risks and mitigation plans in the risk framework. Risk classification is based on velocity and impact of the risk on the business, and risk movement is justified by objective thresholds for each risk.
Risks and mitigation plan in action
Risks |
Mitigation actions |
Sectoral risk |
|
1 Risk arising from customer concentration – risk of loss of revenue in the event of the loss of a key customer |
Commercial strategy prioritizes client diversification and long-term growth by reducing dependency on individual clients and deepening engagement with key accounts through multi-year contracts. |
Anchored in a customer-centric philosophy, the company is driving initiatives in performance management, engagement, and process simplification to enhance satisfaction and strengthen client partnerships. |
Risks |
Mitigation actions |
Sectoral risk |
|
2 Risk arising from inability to keep pace with clients’ science, technology, digitization and service needs |
Syngene continues to position itself as a partner of choice for innovation-driven clients by investing in next- generation technologies that accelerate discovery research. |
Strategic investments in AI, automation, and scientific advancements ensure readiness for emerging therapeutic approaches. |
|
Oversight by the Board’s Science and Technology Committee—meeting quarterly—reinforces our commitment to staying at the forefront of innovation and delivering differentiated value through advanced capabilities. |
|
3 Risk of loss of business to competition arising from decisions taken with inadequate understanding of competition. |
Strengthening market intelligence is a strategic priority to enhance Syngene’s competitive positioning. |
The focus is on developing a deeper understanding of the competitive landscape, which serves as critical inputs for shaping new business cases, refining service offerings, and enabling data-driven strategic decision- making. |
Risks |
Mitigation actions |
Operational risks |
|
4 Risk arising from the lack of progress in building a pipeline to deliver on the 1-3-5 plan revenue growth in the large molecule business |
Syngene acquired it first Biologics manufacturing facility in Baltimore, USA and expects it to become operational by Dec’25. |
With the acquisition of a Biologics manufacturing facility in Bangalore and another facility in Baltimore, USA, Syngene is putting emphasis on asset utilization through territory planning to build a robust pipeline along with key account management aimed at identifying and nurturing high value clients. |
|
5 Risk arising from the failure to achieve targeted revenue growth in SynVent IDD (Integrated Drug Discovery) and make it a profitable business line |
SynVent has experienced resources in its function who are working closely with other business units, thereby putting operating model in place. It is now critical to build a robust pipeline to achieve revenue targets. |
The team is focused on strengthening pipeline visibility and driving profitability through strategic portfolio expansion. Key initiatives include enhanced marketing efforts, pipeline development, and capability strengthening to enable differentiated service offerings. These actions aim to shift the business from technical success toward sustainable commercial outcomes. |
|
6 Risk arising from inability to establish a commercially viable small molecule CDMO spanning early-stage development to commercial manufacturing |
Strategic efforts are underway to strengthen foundational capabilities and align resources for long-term success in small molecule CDMO. |
This includes refining business development approaches, enhancing internal readiness, and building a sustainable pipeline to support future growth and commercial delivery. |
|
7 Risk arising from failing to establish world class commercial operations |
Syngene’s global sales team, advantageously positioned across key markets in North America, Europe, and Japan, ensures deep customer engagement, enhanced responsiveness, and faster decision-making. Syngene’s commitment to continuous improvement in customer-facing processes through significant investments aims to streamline operations and elevate the customer experience at every touchpoint. |
These initiatives position Syngene as a reliable and agile partner capable of addressing the evolving demands of the global market. |
|
8 Risk arising from gaps in existing infrastructure: refurbishment plan, safety and compliance that may impact operations. |
Regular assessments of short-term and long-term infrastructure needs are conducted through a company-wide executive-level infrastructure committee. |
In addition to focusing on infrastructure planning for future growth, we are implementing a systematic asset refurbishment and space validation process, ensuring alignment with business needs and regulatory compliance. |
|
9 Risk arising from inability or delay in obtaining pharma regulatory approvals that could potentially lead to loss of business or delayed revenue. |
In the highly regulated CRO/CDMO sector, ongoing engagement with regulators at various levels is crucial for ensuring smooth approvals and addressing any necessary clarifications. |
Syngene aims to strengthen its alignment with relevant authorities through collaborative efforts and advocacy within industry groups. |
|
The company is implementing digital tracking systems for licenses and permits to enhance monitoring and compliance across regulatory processes. |
Risks |
Mitigation actions |
10 Risk arising from inadequate customer-centricity in delivering client projects leading to client dissatisfaction and loss of business |
Syngene emphasizes on enhancing customer success capabilities, ensuring proactive risk management and effectivecommunicationacrossclientprojects.Byfosteringacustomer-centricculturethroughtraining,awareness, and process improvements, we are strengthening client relationships and ensuring timely issue resolution. |
The enhancement of capabilities and institutionalized changes has led to a continual improvement in project delivery, thereby enhancing customer satisfaction. |
Risks |
Mitigation actions |
Sectoral risk |
|
11 Risks arising from ineffective execution of scalable systems, processes, technologies, compliance for creating organization with global foot-print. |
With acquisition of global assets and employees working outside India, Syngene is implementing scalable organizational designs and operating models that ensure seamless operations across regions. |
This includes optimizing global supply chain resilience, enhancing talent integration and retention, and maintaining compliance with international regulations. |
|
12 Failure to identify, attract, and retain top talent with the necessary skills and capabilities, resulting in a weakened workforce pipeline, increased turnover, and an inability to meet organizational growth objectives. |
Additionally, we foster a culturally inclusive workforce through cross-cultural training, positioning Syngene as a competitive, adaptive, and culturally sensitive leader in the global marketplace. Syngene’s operations are powered by a highly trained and experienced workforce, with ~86%1 comprising of scientists. To ensure scalable and sustained growth, the company continues to recruit, develop, and retain talent across levels, blending experienced professionals with fresh graduates. |
Through targeted university collaborations and subsequent trainings in Syngene Trainee Academy, the company provides fresh graduates with a strong foundation for their scientific careers. |
|
Leadership development programs have been launched to strengthen managerial capabilities, while Hogan assessments are used to align talent with business needs and accelerate internal mobility. |
|
Fair and competitive compensation practices, underpinned by regular benchmarking, reinforce the company’s commitment to being an employer of choice. Syngene has recently expanded its employee wellness program to improve mental health and holistic wellbeing, improve employee engagement and strengthen long time retention. |
|
13 Risk arising from disruption in operations caused by shortage of water. |
Water is a critical resource for Syngene’s operations, and its strategic management is integral to business continuity and sustainability. |
In response to regional water constraints, Syngene has implemented a multi-pronged approach—combining advanced recycling, rainwater harvesting, and on-site storage—to ensure resilience and reduce dependency on external sources. |
|
Aligned with its long-term sustainability vision, Syngene has significantly reduced its freshwater consumption, increased its recycled water usage to 73% and mitigates location-specific risks through geographic diversification of its operations. |
|
14 Risk arising from lack of inventory planning and management leading to material wastage, delays in project execution and higher costs of operations |
To improve operational efficiency and working capital utilization, there is an enhanced focus on optimizing inventory management through advanced planning and forecasting methodologies. |
Sales Inventory & Operating Process facilitates demand-driven material ordering to effectively manage inventory levels through a material resources planning tool. |
|
This disciplined approach supports agility, cost-effectiveness, and improved supply chain responsiveness. |
Risks |
Mitigation actions |
15 Lack of scalable, simple and |
Syngene is implementing
simplification and digitization of processes across different functions to enhance By embedding a culture of continuous improvement through targeted
awareness and training, we empower |
16 Delay in sourcing and
disruption |
In response to evolving
global dynamics, Syngene is enhancing the resilience of its sourcing and logistics A key focus has been the development of a robust local raw materials
ecosystem, while simultaneously Detailed business continuity plans have been developed in response to
changing international dynamics to |
17 Inability to deliver the
level |
To support sustained growth
and meet evolving client expectations, Syngene is putting emphasis on Key performance areas have been identified, with targeted initiatives
underway to drive continuous These efforts are guided by a structured approach to monitoring progress
and enabling long-term value |
Risks |
Mitigation actions |
Sectoral risk |
|
18 Inability to reduce cost to serve to a level that allows us |
To remain competitive while
ensuring a fair return, Syngene is implementing targeted cost optimization Process improvements through Six Sigma and lean programs are being
deployed to increase efficiency and |
19 Risk of ineffective contract |
To mitigate the risk of
contractual issues, Syngene is enhancing its contract management processes by A digital system is under implementation to align project management with
contract governance. The tool will |
20 Risk arising from lack of a
Business |
In the CRDMO industry, a
robust Business Continuity Management (BCM) is crucial to maintain service delivery To mitigate the risk due to operational disruptions, Business Continuity
Management system has been Detailed recovery strategy has been developed considering all possible
disruptive scenarios, with focus now |
Risks |
Mitigation actions |
21 Risk arising from inability to ensure adequate |
Ensuring the safety of our
people and operations is a priority at Syngene, given the inherent risks associated A company-wide safety culture is driven through leadership
accountability, structured programs like KAVACH, A 52-week safety action plan is in place to improve safety performances.
Safety awareness has been By embedding safety into every layer of the organization—through
proactive governance, open |
22 Risk arising from failure |
Syngene upholds the highest
standards of integrity through a robust Anti-Bribery and Anti-Corruption (ABAC) The ABAC policy applies across the organization and its value chain,
reinforced through mandatory training, By integrating ABAC compliance into onboarding trainings, periodic
refreshers, and ongoing governance |
Financial risks |
|
23 Risk arising from non- |
Company has invested in building
a robust compliance framework, supported by a digital platform for To further strengthen governance, regular third-party audits assess the
effectiveness of compliance measures, |
24 Risk arising from adverse outcomes relating to tax positions |
Syngene adopts a prudent
approach to tax planning to ensure full compliance with tax laws and regulations, To ensure successful outcomes for ongoing tax cases, the company develops
tailored litigation strategies each |
Information / cyber security risks |
|
Risks |
Mitigation actions |
Sectoral risk |
|
25 Risk arising due to failure to |
Company has implemented a
comprehensive data privacy policy, aligned with global regulations and industry A robust governance framework ensures that client data is managed
securely, with a focus on minimizing the Clear contractual agreements define the usage of client data, while
ongoing training and communication |
Risks |
Mitigation actions |
26 Risk arising from inadequate cybersecurity controls leading to |
Syngene has implemented a
multi-layered cybersecurity framework designed to proactively defend against Aligned with international standards, including ISO27001, the company
ensures rigorous governance and An ongoing employee education program further strengthens internal
awareness, empowering teams to |
27 Risk arising from failure to timely implement the identified |
Syngene is systematically
transforming its core operations to drive productivity, streamline processes, and Guided by a comprehensive IT strategy and a digital risk framework, the
company prioritizes the digitization of To ensure the successful implementation of these initiatives, a robust
governance structure and regular |
28 Lack of redundant, robust infrastructure to sustain the new |
As part of Syngenes digital
transformation, the company has deployed redundant infrastructure to mitigate By implementing backup systems and one-click disaster recovery mechanism,
Syngene enhances the reliability This approach underscores our commitment to operational continuity and
the seamless execution of digital |
Environment, Social Governance (ESG)
The Company is committed to creating shared value for all stakeholders through a robust ESG framework. This framework is implemented by the Executive ESG Council under the oversight of the Stakeholder and ESG Committee of the Board.
In FY24, the Company published its fourth ESG Report (2023-24), externally assured by DNV and prepared in alignment with the Global Reporting Initiative (GRI) Universal Standards 2021. Where applicable, the report also aligns with the United Nations Sustainable Development Goals (SDGs) and the Sustainability Accounting Standards Board (SASB) disclosures.
In FY21, the Company conducted a materiality assessment by engaging with key stakeholders, including investors, employees, clients, suppliers, regulators, media, and government bodies. This process helped identify and prioritize ESG issues under Environmental, Social, and Governance pillars, ensuring focused efforts towards meaningful sustainability progress. In FY24, the Company initiated a double materiality assessment to reassess these priorities, evaluating both the impact of its operations on the environment and society and the financial implications of these impacts.
The Company’s Environmental Management System (EMS), certified under ISO 14007, ensures that environmental protection is embedded across all levels of the organization. Environmental metrics are tracked to drive continuous improvement. During the year, the Company explored innovative technologies to reduce its environmental footprint by enhancing energy efficiency, waste management, discharge control, and resource conservation.
As part of its climate commitments, Syngene has adopted Science-Based Targets (SBTi) to align with the Paris Climate Agreement. The Company aims to reduce absolute Scope 1 and 2 GHG emissions by 54.6% by FY33 and engage 81.6% of its suppliers in SBTi commitments by 2028.
On the social front, the Company prioritizes responsible employment practices, including talent acquisition, retention, diversity, equity, and inclusion. It also maintains strong relationships with local communities, reinforcing its commitment to social responsibility.
The governance framework emphasizes transparency, compliance, and accountability at all levels. A key governance initiative is the Supplier Code of Conduct, which sets expectations for corporate behavior, human rights, labor standards, and environmental practices.
Syngene is a member of the United Nations Global Compact, and its ESG disclosures are reported under the S&P Global Dow Jones Sustainability Index, Carbon Disclosure Project (CDP), EcoVadis, Sustainalytics, and MSCI.
Internal Controls
A robust internal control mechanism is a prerequisite to ensure that an organization functions ethically, complies with all legal and regulatory requirements and observes the generally accepted principles of good corporate governance. It is an extension of the overall corporate risk management framework as well as is an integral part of the accounting and financial reporting process.
The Company’s internal control systems are commensurate with the nature of its business and the size and complexity of its operations. The control mechanism provides for well documented policies/guidelines, authorizations, and approval procedures to ensure the orderly and efficient conduct of its business. This includes adherence to Company’s policies, safeguarding of its assets, the prevention and detection of frauds and errors, ensuring the accuracy and completeness of the accounting records and the timely preparation and presentation of reliable financial information. The Company believes that its experienced and qualified employees play a key role in fostering an environment in which controls, assurance, accountability, and ethical behaviour are accorded high importance.
The Company has engaged Deloitte India Advisory Services Private Limited to carry out an internal audit of its activities on a periodic basis. The internal auditors also provide an objective view and reassurance of the internal controls, as well as simultaneously auditing transactions. They report directly to the Audit Committee of the Board, which ensures process independence. The Audit Committee, comprising of Independent Directors, reviews the adequacy and efficacy of the internal controls, as well as the effectiveness of the risk management process across the Company.
Cautionary Statement
The Management of Syngene has prepared and is responsible for the financial statements that appear in this report. These statements conform to the accounting principles generally accepted in India and include amounts based on informed judgments and estimates. Syngene’s projections, estimates and expectations described in this report should be interpreted as ‘forward-looking statements’ that can be impacted by various internal and external risks. Risks associated with market, strategy, technology, operations, and stakeholders can significantly impact the business and the actual results may differ substantially or materially from those expressed or implied.
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