Lactulose market is indeed very interesting. Globally, as per some literature, there are 9 major producers and you are right Fresenius and Danipharm are 2 from that list and seems we are importing major qty from them.
If we search on alibaba there are many lactulose producers in china. But this is a milk derivative and as we know china is suspected of poor quality in diary products. So I think that could be part of the reason why China is not trusted for lactulose, while we probably import roughly 80% of other API’s from them.
India is a mostly importing bulk lactulose (by tonnes), while exporting it form of small dosages like tablets and small bottles. Plus, lactulose has a wide non-pharma use, mostly as a food additive.
So, my guess is, mgmt. got this idea of getting into lactulose production based on their association with Kerry. Kerry after all is one of the world’s largest food ingredient producer. I think the usage must be going up for lactulose as it’s used for infant formula, pet food, yoghurt, beverages etc…which are mostly growing segments.
Searching for lactulose producers in India , leads to vague results, so am assuming there no producers currently and there is a strong case for import substitution.
It’s been UC since the Q2 results were declared 
, would have liked to add more below 60.
Nirav already answered your questions on the usage of cash flow from lactose facility.
Disc: Invested before the Q1 results.
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