CRISIL has reaffirmed 'AA/Stable' ratings on the bank facilities and debt programmes of IPCA Laboratories (IPCA). The ratings continue to reflect IPCA's well-diversified business risk profile (spread across therapeutic segments and geographies), established position in the formulations segment both, in domestic and international markets, and integrated operations. The ratings also factor in the company's sound financial risk profile, marked by a robust capital structure and healthy debt protection metrics.

These rating strengths are partially offset by IPCA's working-capital-intensive operations, exposure to intensifying competition in the pharmaceutical industry, and susceptibility to adverse regulatory changes in the domestic and international markets.

CRISIL believes that IPCA will maintain strong business risk profile supported by its established position in the diversified therapeutic segments and geographies. The healthy cash flows from operations are likely to result in strong cash accruals which will enable the company to support its debt protection metrics.

The outlook may be revised to 'Positive' if the company achieves significantly high and sustainable revenue growth in key therapeutic segments across geographies while maintaining its operating profitability, and improves its working capital management. Conversely, the outlook may be revised to 'Negative' if IPCA undertakes a considerably large debt-funded capital expenditure, thereby impacting its financial risk profile.

Shares of the company gained Rs 1.75, or 0.24%, to trade at Rs 744.90. The total volume of shares traded was 14,867 at the BSE (11.34 a.m., Monday).