The company has signed an agreement on 13th March 2023 with N. Govindarajan, a well-recognised professional having rich experience in the Indian pharmaceutical industry, for establishment of CDMO business through a new subsidiary to be incorporated. The proposed subsidiary will focus on API and other products.

Govindarajan is the former managing director of Aurobindo Pharma, who stepped down in October 2021 after being at the helm for over a decade. "Govindarajan will be the chief executive officer of the subsidiary and will be establishing the business and driving its growth and profitability," Tube Investments said.

The company proposes to invest up to Rs 285 crore into this subsidiary in the form of equity and compulsorily convertible preference shares in tranches. Govindarajan will be investing up to Rs 15 crore in equity and compulsorily convertible preference shares in tranches.

Subject to the performance and other terms and conditions specified in the agreement, Govindarajan will be entitled to get up to 25% of the equity for his investment.

Commenting on this new venture, M.A.M Arunachalam (known as Arun Murugappan), Executive Chairman of the Company said, "TII's foray in to CDMO, a business with high growth potential, augurs well with its plan to diversify its business portfolio and reduce dependency on traditional revenue streams. TII is delighted to join hands with Mr. N. Govindarajan, a well accomplished professional in the pharmaceutical industry in India."

Tube Investments of India, a Murugappa Group company, manufactures fabricated metal products. The company specializes in cycles, steel tubes, strips, chains, and metal formed items.

The company reported 15.47% fall in consolidated net profit to Rs 235.75 crore on a 7.52% increase in sales to Rs 3,538.02 crore in Q3 FY23 over Q3 FY22.