Mumbai: Drug manufacturer Cipla Ltd on Tuesday said it will receive a potential investment from FIL Capital Investments Mauritius II Ltd in its newly formed consumer healthcare subsidiary, without disclosing financial details.

FIL Capital Investments is the investment arm of Fidelity Growth Partners India, the private equity arm of Fidelity International Ltd that is focused on investing in India.

In its statement to the exchanges, Mumbai-based Cipla said the board of directors approved the investment by FIL Capital on 20 July. “Cipla will be divesting its consumer healthcare business on a going-concern basis," a statement said.

Cipla shares closed 2.79% lower at 663.9 on the BSE on Tuesday, while the benchmark Sensex fell 0.84%.

Through Cipla Consumer Healthcare, the company has re-entered the fast-growing over-the-counter (OTC) healthcare market in India. In 2010, Cipla exited the OTC market by selling its emergency contraceptive brand i-pill to Piramal Healthcare Ltd for 95 crore. Introduced in 2007, the i-pill is the largest selling emergency contraceptive in India.

“Partnering with a long-term strategic and financial investor like Fidelity Growth Partners on this journey will help us create a best-in-class consumer healthcare business. In the consumer healthcare business, we need a strong FMCG (fast-moving consumer good) talent pool and the right ecosystem with a “pharma in/FMCG out" mind-set," said Samina Vaziralli, executive director, Cipla.

Last month, Cipla said it will move its consumer healthcare business into a separate unit to sharpen its focus on the segment and boost sales. The Cipla board had approved the divestment of its consumer healthcare business to a wholly owned subsidiary for a consideration of 10.5 crore. Cipla’s consumer healthcare division recently launched its first product Nicotex, a gum used against smoking.

The Indian consumer healthcare market is currently a $4 billion market and is growing at a compound annual growth rate of 15%. It is expected to be a $10 billion market by 2020, the statement from Cipla said.

“Over-the-counter consumer healthcare is a nascent but rapidly growing market in India, and one we are very excited about. Using our combined knowledge and resources, we intend to provide OTC products that will bring significant benefits to the consumer," said Raj Dugar, senior managing director, Fidelity Growth Partners India.

The consumer healthcare division reported sales of 34.88 crore, or about 0.3% of total revenue, in the year ended 31 March.

Fidelity Growth Partners has been actively investing in the Indian healthcare segment. Last month, Fidelity Growth Partners India and Fidelity Biosciences, Boston, invested about $10 million in Medwell Ventures Pvt. Ltd, a Bengaluru-based home healthcare start-up.

Fidelity’s other healthcare investments in India include Laurus Labs, Trivitrion Healthcare Pvt. Ltd, Cygnus Medicare Pvt. Ltd and Bengaluru-based Richcore Lifesciences Pvt. Ltd.