Business updates
- The net borrowings stand at Rs 1179 crores
- The SARTANS market is quite stable and no single company has too big a market share
- The current quarter was an exceptional quarter for Europe & ROW business along with good performance in the API business
- The management expects growth in API business to continue in subsequent quarters as well
- Have filed 8 ANDA’s during the quarter and cumulative approvals stand at 125
- The India business de grew by 7% YoY
Participants
- Aviva
- JM Financial
- Axis Capital
- Vallum Capital
- HSBC Securities
- Credence Wealth
- Dalal & Broacha
- Nirmal Bang
- Sanmati Consultants
- Equirus
- Centrum Broking
- Mittal Analytics
QnA
- Two major expenses got reduced, which are field people who couldn’t travel and also sales promotion expenses.
- The R&D expenses were also comparably lower
- In the US, the company will be launching 15-20 products during the current year
- The competitive intensity in the US market has come down a little bit and the company will continue to invest in the market
- The liquid formulations are a drag at the current moment in the India business
- The company is not getting into biosimilars
- SARTANS
- There are 3-5 companies that are dominant in the SARTANS portfolio
- Not chasing market share but chasing higher profitability within the SARTANS opportunity
- Currently, the company is holding onto its market share in SARTANS and it is up to them to lose
- The target for the US markets is to launch 15-20 products on an annual basis for the next few years
- API
- The API segment has not been a focus area for the last few years
- The API sales are lumpy because we do contract manufacturing for a client in the USA
- There is no clarity on the domestic business because states are going into lockdown at different times and thus predictions on domestic business will be a guesswork
- CAPEX
- The maintenance CAPEX is Rs 350 crores a year
- Over the next two years planning to spend Rs 650 crores on expanding injectable facility
- The government is relaxing regulations on API facility so will be spending CAPEX on API facilities as well
- The management is looking at a QIP which will be used to augment capacity as well as payback some debt
- There was zero revenue in the current quarter from the contract manufacturing business in API segment
- In the ROW market, the company has no front end and works on a B2B basis
- In the US market, the company sells to the distributors and sales channel
- The injectable portfolio will start with plain vanilla products and then slowly move towards complex generic products.
- Will be filing in the oncology segment over a period of six months
- No decision currently by USFDA as to when inspections for the new facilities will start
- The product shortages in the US market have been continuing for a long time and the management remains confident of the opportunity in the US market
Image source: Company website
Read more concall summaries here.
