Godfrey Phillips India Limited has informed the Exchange about Arrangements for strategic, technical, manufacturing, or marketing tie up - Contract Manufacturing Agreement.
GODFRYPHLP · price
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Godfrey Phillips India has signed a 9-year Contract Manufacturing Agreement with Polisetty Somasundaram Tobacco Products (India) Pvt. Ltd. Under this arrangement, Polisetty will manufacture cigarettes and other tobacco products exclusively for Godfrey Phillips at its own facility. Polisetty has 12 months to set up the manufacturing facility and obtain necessary licenses. The company will pay a manufacturing fee (fixed and variable components) to Polisetty and may also provide machines and equipment on a bailment basis. Polisetty is a relatively small entity with revenue of Rs. 186 lakhs and profit after tax of Rs. 164 lakhs for FY25. The agreement is not a related party transaction.
This is a strategic manufacturing partnership that could help Godfrey Phillips expand production capacity and ensure uninterrupted product supply. However, it does not involve any change in ownership, acquisition, or joint venture structure, so the impact on the company's fundamentals may be limited.