MIRA INFORM REPORT
|
Report Date : |
9th May 2006 |
IDENTIFICATION DETAILS
|
Name : |
CIPLA
LIMITED |
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Registered Office : |
289,
J. B. B. Marg, Mumbai Central, Mumbai – 400 008, Maharashtra, India |
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Country : |
India |
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Financials (as on) : |
31.03.2005 |
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Date of Incorporation : |
17th
August, 1935 |
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Com. Reg. No.: |
11-2380 |
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TAN No.: (Tax Deduction &
Collection Account No.) |
MUMC00352C |
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Legal Form : |
Public Limited Liability
Company. The company's shares are
listed on the Stock Exchanges. |
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Line of Business : |
Manufacturing of Chemicals,
Tablets and Capsules, Liquids, Creams, Aerosols, Injections, Sterile Solution
and Agrochemicals and Formulations. The
company manufactures and markets bulk drugs and formulations. |
RATING & COMMENTS
|
MIRA’s Rating : |
Aa |
RATING
|
STATUS |
PROPOSED CREDIT LINE |
|
|
71-85 |
Aa |
Possesses adequate
working capital. No caution needed for credit transaction. It has above
average (strong) capability for payment of interest and principal sums |
Large |
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Maximum Credit Limit : |
USD 69000000 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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Litigation : |
Clear |
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Comments : |
Subject is a
well-established and reputed pharmaceutical company having fine track. Available information indicates high
financial responsibility of the company. Financial position of the
company is considered as good.
Business is active. The company can be
considered normal for business dealings at usual trade terms and conditions. |
LOCATIONS
|
Registered/Corporate Office : |
289,
J. B. B. Marg, Mumbai Central, Mumbai – 400 008, Maharashtra, India |
|
Tel. No.: |
91-22-23095521/23082891/23023272 |
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Fax No.: |
91-22-23070013/23070393/85/23008101 |
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E-Mail : |
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Website : |
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Factory 1 : |
MIDC, Patalganga – 410 220,
District Raigad, Maharashtra, India. |
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Factory 2 : |
D7,
MIDC Industrial Area, Kurkumbh – 413 802, District Pune, Maharashtra, India |
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Factory 3 : |
LBS Marg, Vikhroli (West),
Mumbai – 400 083, Maharashtra, India. |
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Factory 4 : |
Virgonagar, Old Madras
Road, Bangalore – 560 049, Karnataka, India. |
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Factory 5 : |
Verna Industrial Estate,
Verna-403722, Salcette, Goa, Panaji |
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Sales Office: |
Located At : Kochi, Ghaziabad, Kolkata, Chennai, Hyderabad, Delhi, Assam, Nagpur, Chandigarh, Patna, Ambala Cantt., Patna, Vijayawada, Varanasi, Rajasthan, Lucknow, Ahmedabad, Indore, Mumbai, Madhya Pradesh, Pune and Bangalore. |
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Branch : |
289, Bellasis Road,
Dimitkar, Mumbai – 400 008, Maharashtra |
DIRECTORS
|
Name : |
Dr. H. R. Manchanda |
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Designation : |
Non-Executive
Director |
|
Qualification : |
M.B.B.S.,
F.R.C.S. |
|
Experience : |
1. Consultant Surgeon at Breach Candy Hospital since
1960. It is also on panel of physicians for USA Visa work at Breach Candy
Hospital. 2. Professor of Surgery and Head of Surgery at J.J.
Hospital and Grant Medical College for the period 1960-85. Haffkine
Institute – Board Member |
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Date of Appointment : |
1983 |
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|
|
|
Name : |
Mr.
S. A. A. Pinto |
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Designation : |
Non-Executive
Director |
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Qualification : |
M.A.(Economics),
LL.B |
|
Experience : |
1. Kotak Mahindra Finance Limited – Director and Member
of Audit Committee and Chairman of Investor Relations Committee 2. Kotak Mahindra Private-Equity Trustee Limited –
Chairman |
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Date of Appointment : |
1983 |
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|
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Name : |
Dr.
Y. K. Hamied |
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Designation : |
Chairman
& Managing Director |
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|
Name : |
Mr.
Amar Lulla |
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Designation : |
Joint
Managing Director |
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Name : |
Mr.
M. K. Hamied |
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Designation : |
Joint
Managing Director |
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Name : |
Mr.
V. C. Kotwal |
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Designation : |
Non-Executive
Director |
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Name : |
Mr.
M. R. Raghavan |
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Designation : |
Non-Executive
Director |
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Name : |
Mr.
Ramesh Shroff |
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Designation : |
Non-Executive
Director |
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Name : |
Mr.
M. K. Gurjar |
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Designation : |
Non-Executive
Director |
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MAJOR SHAREHOLDERS
Category
|
No.
of Shares
|
%
of Holding
|
Promoters'
holdings
|
|
|
|
Indian Promoters |
23,950,112 |
39.94% |
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|
|
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Non
promoter's holdings
|
|
|
|
Mutual Funds and UTI |
3,564,975 |
5.94% |
|
Banks, Financial Institutions
and Insurance Companies |
6,127,356 |
10.22% |
|
FIIs |
5,184,232 |
8.64% |
|
|
|
|
|
Private Corporate Bodies |
1,369,319 |
2.28% |
|
Others |
133,782 |
0.22% |
|
NRIs / OCBs |
2,121,742 |
3.54% |
|
General
Public |
17,520,831 |
29.21% |
|
Grand Total |
59,972,349 |
100.00% |
BUSINESS DETAILS
|
Line of Business : |
Manufacturing of Chemicals,
Tablets and Capsules, Liquids, Creams, Aerosols, Injections, Sterile Solution
and Agrochemicals and Formulations. The
company manufactures and markets bulk drugs and formulations. |
|
|
|
|
Products : |
PRODUCTION STATUS
|
Class of Goods |
Units |
Installed Capacity |
Actual Production |
|
Bulk Drugs (including
Malts) |
Tonne |
1519.0 |
881.6 |
|
Tablets and Capsules |
Million |
9468.0 |
8640.5 |
|
Liquids |
Kilolitre |
1440.0 |
5832.4 |
|
Creams |
Tonne |
216.0 |
467.3 |
|
Aerosols/Inhalation Devices |
Thousand |
45780.0 |
40732.2 |
|
Injections/Sterile
Solutions |
Kilolitre |
610.0 |
802.7 |
|
Others |
Million |
-- |
2.3 |
GENERAL INFORMATION
|
No. of Employees : |
2,200 |
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Bankers : |
v
Bank of Baroda,
Mumbai, Maharashtra v
Canara Bank, Mumbai,
Maharashtra v
Corporation Bank,
Mumbai, Maharashtra v
Indian Overseas Bank,
Mumbai, Maharashtra v
Standard Chartered
Grindlays Bank Limited, Mumbai, Maharashtra v
The Hong Kong &
Shanghai Banking Corporation Limited, Mumbai, Maharashtra v
Corporation Limited,
Mumbai, Maharashtra v
Union Bank of India,
Mumbai, Maharashtra |
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Facilities : |
The company enjoys
following facilities from it’s bankers :-
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Banking Relations : |
Good |
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Auditors : |
v
R. S. Bharucha &
Company Chartered Accountants v
R. G. N. Price &
Company Chartered Accountants |
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Address: |
Mumbai , Maharashtra |
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CAPITAL STRUCTURE
Authorised Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
325000000 |
Equity
Share of |
Rs.2/- each |
Rs.650.000 millions |
Issued Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
300873628 |
Equity
shares of |
Rs.2/- each |
Rs. 601.750 millions |
Subscribed &
Paid-up Capital :
|
No. of Shares |
Type |
Value |
Amount |
|
299870233 |
Equity
Shares of |
Rs.2/- each |
Rs.599.740 millions |
FINANCIAL
DATA
[all figures are in Rupees Millions]
ABRIDGED
BALANCE SHEET
|
SOURCES OF FUNDS |
31.03.2005 |
31.03.2004 |
31.03.2003 |
|
|
SHAREHOLDERS FUNDS |
|
|
|
|
|
1] Share Capital |
599.74 |
599.720 |
599.720 |
|
|
3] Reserves & Surplus |
14936.640 |
12040.780 |
10101.070 |
|
NETWORTH
|
15536.380 |
12640.500 |
10700.790 |
|
|
LOAN FUNDS |
|
|
|
|
|
1] Secured Loans |
403.730 |
305.990 |
288.860 |
|
|
2] Unsecured Loans |
1546.690 |
1799.850 |
658.970 |
|
TOTAL
BORROWING
|
1950.420 |
2105.840 |
947.830 |
|
|
DEFERRED TAX LIABILITIES |
889.460 |
659.460 |
561.960 |
|
|
Equity
Shares to be issued |
|
0.020 |
0.000 |
|
|
|
|
|
|
|
TOTAL
|
18376.260 |
15405.820 |
12210.580 |
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|
|
|
|
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APPLICATION OF FUNDS
|
|
|
|
|
|
|
|
|
|
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FIXED ASSETS [Net Block]
|
7389.100 |
5475.610 |
3710.480 |
|
Capital work-in-progress
|
1059.640 |
560.110 |
288.350 |
|
|
|
|
|
|
|
INVESTMENT
|
183.020 |
1803.690 |
1265.940 |
|
DEFERREX TAX ASSETS
|
0.000 |
0.000 |
0.000 |
|
|
|
|
|
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CURRENT ASSETS, LOANS & ADVANCES
|
|
|
|
|
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Inventories
|
7456.790 |
5689.420 |
5892.380 |
|
|
Sundry Debtors
|
5873.230 |
4982.270 |
3553.660 |
|
|
Cash & Bank Balances
|
153.800 |
62.440 |
131.160 |
|
|
Other Current Assets
|
135.170 |
75.580 |
25.400 |
|
|
Loans & Advances
|
3909.90 |
3552.590 |
3308.390 |
Total Current Assets
|
17528.890 |
14362.300 |
12910.990 |
|
Less : CURRENT LIABILITIES & PROVISIONS
|
|
|
|
|
|
|
Current Liabilities
|
4944.540 |
3753.530 |
5966.170 |
|
|
Provisions
|
2839.850 |
3042.360 |
-- |
Total Current Liabilities
|
7784.390 |
6795.890 |
5966.170 |
|
Net Current
Assets
|
9744.500 |
7566.410 |
6944.820 |
|
|
|
|
|
|
|
MISCELLANEOUS EXPENSES
|
0.000 |
0.000 |
0.990 |
|
|
|
|
|
|
|
TOTAL
|
18376.260 |
15405.820 |
12210.580 |
|
PROFIT & LOSS ACCOUNT
|
PARTICULARS |
31.03.2005 |
31.03.2004 |
31.03.2003 |
Sales Turnover [including other income]
|
23364.980 |
19585.930 |
14864.900 |
|
|
|
|
|
Profit/(Loss) Before Tax
|
5146.140 |
4040.860 |
3124.940 |
Provision for Taxation
|
1050.000 |
973.950 |
647.500 |
Profit/(Loss) After Tax
|
4096.140 |
3066.910 |
2477.440 |
|
|
|
|
|
Export Value
|
NA |
8706.130 |
5729.210 |
|
|
|
|
|
Import Value
|
4477.330 |
2842.200 |
2801.980 |
|
|
|
|
|
Total Expenditure
|
18218.840 |
15545.070 |
11739.960 |
QUARTERLY
200506 Quarter 1 -
EPS is Basic and Diluted. Status of
Investor Complaints for the quarter ended June 30, 2005 Complaints Pending at
the beginning of the quarter Nil Complaints Received during the quarter 06
Complaints disposed off during the quarter 06 Complaints unresolved at the end
of the quarter Nil 1. The Company is exclusively in the pharmaceutical business
segment. 2. The Directors at their meeting held on July 25, 2005 recommended
payment of dividend of Rs 3.50 per equity share (face value Rs 2) for the year
2004-2005 amounting to Rs 1049.5 million. 3. The Company had challenged the
inclusion of the drugs - Salbutamol, Theophylline, Ciprofloxacin and
Norfloxacin within the ambit of price control. The petition filed by the
Company had been decided in favour of the Company by the Bombay High Court,
which held that the said drugs were outside the ambit of price control.
However, on an appeal filed by the government, the Supreme Court has remanded
the matter to the Bombay High Court for further and more detailed examination
in light of the principles laid down by the Supreme Court. The Supreme Court
had also permitted the government to recover 50% of the amount that they had
claimed was overcharged. The government had sent notices to the Company
demanding an aggregate of Rs 1803.70 million in respect of the said drugs,
which according to them was 50% of the amount allegedly overcharged by the
Company till July 2003. Subsequently, in a separate proceeding the Allahabad
High Court had ruled that the prices fixed by the government in respect of the
said drugs were illegal and void. On an appeal filed by the government against
this ruling, the Supreme Court has stayed the judgment of the Allahabad High
Court. Further, the Supreme Court has directed that no coercive action shall be
taken against the Company till the appeal is finally decided. The Company has
been advised that the demand notices of the government are not valid. 4. The
figures of the previous year have been regrouped/recast to render them
comparable with the figures of the current year. 5. The above results were
taken on record at the meeting of the Board of Directors held on July 25, 2005.
200509 Quarter 2 -
EPS is Basic & Diluted Expenditure
Includes (Increase) / Decrease in Stock in Trade Rs 85.30 million Consumption
of Raw Materials Rs 2825.60 million Staff Cost Rs 303.40 million Other
Expenditure Rs 1730.10 million Tax Includes Provision for Current Tax Rs 266.00
million Deferred Tax Rs 50.00 million Fringe Benefit Tax Rs 14.00 million
Status of Investor Complaints for the quarter ended September 30, 2005
Complaints Pending at the beginning of the quarter Nil Complaints Received
during the quarter 13 Complaints disposed off during the quarter 13 Complaints
unresolved at the end of the quarter Nil 1. The Company is exclusively in the
pharmaceutical business segment. 2. The Company had challenged the inclusion of
the drugs - Salbutamol, Theophylline, Ciprofloxacin and Norfloxacin within the
ambit of price control. The petition filed by the Company had been decided in
favour of the Company by the Bombay High Court, which held that the said drugs
were outside the ambit of price control. However, on an appeal filed by the
government, the Supreme Court has remanded the matter to the Bombay High Court
for further and more detailed examination in light of the principles laid down
by the Supreme Court. The Supreme Court had also permitted the government to
recover 50% of the amount that they had claimed was overcharged. The government
had sent notices to the Company demanding an aggregate of Rs 1803.70 million in
respect of the said drugs, which according to them was 50% of the amount
allegedly overcharged by the Company till July 2003. Subsequently, in a separate
proceeding the Allahabad High Court had ruled that the prices fixed by the
government in respect of the said drugs were illegal and void. On an appeal
filed by the government against this ruling, the Supreme Court has stayed the
judgment of the Allahabad High Court. Further, the Supreme Court has directed
that no coercive action shall be taken against the Company till the appeal is
finally decided. The Company has received legal advise that the demand notices
of the government are not sustainable. 3. Due to unprecedented rains on July
26, 2005, the Company's godowns at Bhiwandi were flooded causing substantial
damage to its stocks of finished goods. The insurance claims are under process.
It is expected that the amount of settlement of insurance claims will not be
less than the cost of damaged stocks. 4. The above results were taken on record
at the meeting of the Board of Directors held on October 27, 2005.
200512 Quarter 3 -
Expenditure Includes (Increase) / Decrease in Stock in Trade Rs (667.10) million Consumption of Raw Materials Rs 4537.70 million Staff Cost Rs 351.70 million Other Expenditure Rs 1994.60 million Tax Includes Provision for Current Tax Rs 287.00 million Fringe Benefit Tax Rs 13.00 million Status of Investor Complaints for the quarter ended December 31, 2005 Complaints Pending at the beginning of the quarter Nil Complaints Received during the quarter 09 Complaints disposed off during the quarter 09 Complaints unresolved at the end of the quarter Nil 1. The Company is exclusively in the pharmaceutical business segment. 2. The figures of the previous year have been recast / regrouped to render them comparable with the figures of the current year. 3. The Company had challenged the inclusion of the drugs - Salbutamol, Theophylline, Ciprofloxacin and Norfloxacin within the ambit of price control. The petition filed by the Company had been decided in favour of the Company by the Bombay High Court, which held that the said drugs were outside the ambit of price control. However, on an appeal filed by the government, the Supreme Court has remanded the matter to the Bombay High Court for further and more detailed examination in light of the principles laid down by the Supreme Court. The Supreme Court had also permitted the government to recover 50% of the amount that they had claimed was overcharged. The government had sent notices to the Company demanding an aggregate of Rs 1803.70 million in respect of the said drugs, which according to them was 50% of the amount allegedly overcharged by the Company till July 2003. Subsequently, in a separate proceeding the Allahabad High Court had ruled that the prices fixed by the government in respect of the said drugs were illegal and void. On an appeal filed by the government against this ruling, the Supreme Court has stayed the judgment of the Allahabad High Court. Further, the Supreme Court has directed that no coercive action shall be taken against the Company till the appeal is finally decided. The Company has received legal advice that the demand notices of the government are not sustainable. 4. Other income includes an amount of Rs 727.20 million being on account payment received against insurance claims. These claims were mainly under Declared Value Policies in respect of damage to finished goods at the Company's Bhiwandi godown caused by the floods in July 2005. The total cost of the said finished goods cannot be precisely determined in view of the impact of common and unallocable expenses. Consequent, the full amount of claims received has been accounted as other income. 5. The above results after being reviewed by the Audit Committee were approved and taken on record at the meeting of the Board of Directors held on January 24, 2006.
200603 Quarter 4 –
Tax Includes Provision for Current Tax Rs 70.00 million Fringe Benefit Tax Rs 10.00 million Status of Investor Complaints for the quarter ended March 31, 2006 Complaints Pending at the beginning of the quarter Nil Complaints Received during the quarter 07 Complaints disposed off during the quarter 07 Complaints unresolved at the end of the quarter Nil 1. The Company is exclusively in the pharmaceutical business segment. 2. The figures of the previous year have been recast / regrouped to render them comparable with the figures of the current year. 3. In April 2006, the Company has raised US$ 170 million (Rs 7622 million) through an issue of 1,10,46,310 Global Depository Receipts (GDRs). Each GDR represents one equity share of Rs 2 each and was priced at US$ 15.39 (equivalent to Rs 690). The said GDRs have been listed on the Luxembourg Stock Exchange and the Company has already applied to Bombay Stock Exchange Ltd (BSE) and National Stock Exchange of India Ltd (NSE) for having the underlying shares listed. 4. The Board of Directors recommended the issue of bonus shares in the ratio of three shares for every two shares held and the shareholders have approved the same through a postal ballot on March 21, 2006. The record date for determining the members who are entitled to the bonus shares is April 25, 2006. 5. Consequent to the issue of GDRs and bonus shares as stated in (3) and (4) above, the paid-up equity share capital will stand increased to Rs 1554.60 million. 6. The Company had challenged the inclusion of the drugs - Salbutamol, Theophylline, Ciprofloxacin and Norfloxacin - within the ambit of price control. The petition filed by the Company had been decided in favour of the Company by the Bombay High Court, which held that the said drugs were outside the ambit of price control. However, on an appeal filed by the government, the Supreme Court has remanded the matter to the Bombay High Court for further and more detailed examination in the light of the principles laid down by the Supreme Court. The Supreme Court had also permitted the government to recover 50% of the amount that they had claimed was overcharged. The government had sent notices to the Company demanding an aggregate of Rs 1803.70 million in respect of the said drugs, which according to them was 50% of the amount allegedly overcharged by the Company till July 2003. Subsequently, in separate proceedings the Allahabad High Court had ruled that the prices fixed by the government in respect of the said drugs were illegal and void. On an appeal filed by the government against this ruling, the Supreme Court has stayed the judgment of the Allahabad High Court. Further, the Supreme Court has directed that no coercive action shall be taken against the Company till the appeal is finally decided. The Company has received legal advice that the demand notices of the government are not sustainable. 7. Other income includes Rs 197 million being the amount settled during the quarter against insurance claims relating to losses on account of floods. The total amount of such claims settled during the year aggregated to Rs 924.20 million. These claims were mainly under Declared Value Policies in respect of damage to finished goods at the Company's Bhiwandi godown caused by the floods in July 2005. The total cost of the said finished goods cannot be precisely determined in view of the impact of common and unallocable expenses. Consequently, the full amount of claims received has been accounted as other income. 8. The above results after being reviewed by the Audit Committee were approved and taken on record at the meeting of the Board of Directors held on April 25, 2006.
SUMMARISED RESULTS
|
PARTICULARS |
|
|
31.03.2006 Full Year |
|
Sales Turnover |
|
|
2,9857.200 |
|
Other Income |
|
|
1311.000 |
|
Total Income |
|
|
3,1168.200 |
|
Total Expenditure |
|
|
2,3193.200 |
|
Operating Profit |
|
|
7975.000 |
|
Interest |
|
|
114.200 |
|
Gross Profit |
|
|
7860.800 |
|
Depreciation |
|
|
830.000 |
|
Tax |
|
|
932.500 |
|
Reported PAT |
|
|
6000.800 |
|
Dividend (%) |
|
|
00.000 |
KEY RATIOS
|
PARTICULARS |
31.03.2005 |
31.03.2004 |
31.03.2003 |
|
Debt Equity Ratio |
0.15 |
0.13 |
0.07 |
|
Long Term Debt Equity Ratio |
0.12 |
0.11 |
0.04 |
|
Current Ratio |
1.89 |
1.87 |
1.90 |
|
TURNOVER RATIOS |
|
|
|
|
Fixed Assets |
2.73 |
3.19 |
3.39 |
|
Inventory |
3.54 |
3.41 |
3.15 |
|
Debtors |
4.29 |
4.63 |
5.08 |
|
Interest Cover Ratio |
39.73 |
30.28 |
70.60 |
|
Operating Profit Margin (%) |
22.27 |
22.70 |
22.28 |
|
Profit Before Interest and Tax Margin (%) |
19.90 |
20.66 |
20.45 |
|
Cash Profit Margin (%) |
17.81 |
17.57 |
17.82 |
|
Adjusted Net Profit Margin (%) |
15.44 |
15.53 |
15.99 |
|
Return on Capital Employed (%) |
28.93 |
31.15 |
30.66 |
|
Return on Net Worth (%) |
25.70 |
26.51 |
25.55 |
STOCK PRICES
|
Face
Value |
Rs.
2.00/- |
|
High |
Rs.
275.00/- |
|
Low |
Rs.
267.50/- |
LOCAL AGENCY FURTHER INFORMATION
One of the largest drug manufactures, Cipla manufactures
and markets bulk drugs and formulations. It is now ranked second in India by
ORG in terms of retail pharmaceutical sales. It has manfacturing facilities at
Kurkumbh, Bangalore, Patalganda and Vikroli in Mumbai. All the bulk drug
facilities have been approved by the US FDA and the formulation facilities have
been approved by the Medicine Control Agency, UK; the Medicine Control Council,
South Africa; the Therapeutic Goods Administration, Australia and other
international agencies.
Cipla has a very wide product range which includes antibiotics,
anti-bacterials, anti-asthmatics, anti-inflammatory anthelminites, anti-cancer
and cardiovasculars. In domestic formulation market, antibiotics are the
mainstay, which contributes around 50% of the company's revenue. Some of the
leading brands are Ciplox (Ciprofloxacin), Novamox (Amoxycilin) and Norflox
(Norfloxacin). Cipla also has in its product portfolio Zidovir (zidovudine,
anti-AIDS drug). Cipla was one of the first among the Indian pharmaceutical
companies to introduce ampicillin and norfloxacin.
The company is constantly maintained its lead in introducing new drug
formulation. The company has very strong research and developement facilities
which has been bearing fruits. Its ability to quickly duplicate a new drug
introduced elsewhere and introduce it in the Indian market has played a
significant role in building a basket of formulation brands. Being one of the
earliest entrants into the market with a new drug, generally, enables a company
achieve higher realisations. In addition to being among the early entrants, one
aspect which has given an edge to Cipla's strategy is the ability to market
products at a significantly lower price.
Cipla has developed the world's first budesonide-based,
chlorofluorocarbons (CFC) - free anti-asthma inhaler, 'Budecort CFC-free'.
Budesonide, which falls in the preventive class of anti-asthmatic drugs, is
essentially a steroid and preferred due to its safety profile. The company has
invested over Rs 20 Millions in developing CFC-free asthma products over a
period of 12 month. The product is largely being targeted at the international
markets, which are CFC-sensitive and is awaiting for registration in the
European markets. The fruits of the new product will be obtained in the coming
years, since the company expects to increase its exports through this
product.
In Dec 2000, the company cut the price of its anti-AIDS drug Nevimune
(scientific name : nevirapine) by 34% to Rs 650 for a strip of ten tablets. The
price was earlier Rs 985. Cipla has slashed the price of the drug thrice
reducing it from the launch price of Rs 1,350 for a strip of ten to the current
price. The company attributes this to improvements in technology that has
enabled it to cut costs and pass on the savings to consumers.
Cipla is the only manufacturer of nevirapine from the basic stage in
India. This is the fourth price cut of anti-AIDS drugs effected by Cipla in the
last three years. The last reduction was in Sep 2000 when prices of its
Lamivir, Duovir, Stavir and Nevimune brands were cut between 13 - 45% across
six dosage forms.
Among the large pharma companies, Cipla was considered as the fastest
growing company with a pre-eminent position in anti-asthma and its foray into
high-growth areas like anti-cancer and anti-AIDS. However, current performance
is not in line with this perception.
The company is a leader in the anti-bacterial and anti-asthmatic segments
in FY 2000. Cipla became the first player outside the US and Europe to launch
non-CFC (chlorofluorocarbons) metered dose inhalers. The company has applied
for process registration in Europe, which it is likely to get in 2002.
The market for such metered dose inhalers in the US and Europe is worth
around $ 2.5 billion and is growing at 20% p.a. Thus, even a mere 2% market
share can rake in more than Rs 230 crore into Cipla's kitty. Cipla has one of
the best R&D facilities for reverse engineering in the country. As in the
past, its R&D division continues with its focus on finding new processes
for existing products.
After growing smartly in the domestic market, the company is now
focussing on export markets. Cipla has tied up with US major Andrx to supply
Omeprazole, an anti-ulcer bulk drug slated to go off patent in October. Andrx
is expected to gain the 180 days exclusivity for marketing the generic
Omeprazole in the US market, post-patent expiry in October 2001.
Cipla has also tied up with the US-based Zenith Goldline and United
Research Labs for marketing Flutamide (an oncology drug) and Felodipine (a
cardiovascular drug) in the US and European markets. Flutamide will go off
patent in May, while the patent for Felodipine will expire in late 2001. Cipla
is now focussing on high-margin areas like anti-AIDS, cardiovascular and
anti-cancer, in order to reduce its exposure to the highly competitive
anti-infectives segment.
Recently, in July 2001, the company has effected another round of price
cuts of its anti-AIDS drug segment. This is the fourth price cut in AIDS
segment during the last nine months (last one was in May 2001). The company has
cut prices of its triple drug regimen by as much as 39%. The three-drug
combination of lamivudine, stavudine and nevirapine, which has the potential to
reduce the HIV virus in the body to very low levels, will now cost the patient
Rs 2,130 per month down from Rs 3,495 per month.
Cipla has a very good product pipeline for years to come. The only threat
for the company is that the government is going to introduce the product
patents post 2005. But even if it is introduced, the company expects that it is
only going to be affected after 2012 or 2015. Because, till then, the company
has very good product pipeline. But as per company reports, if government is
pragmatic in framing new patent laws, then Cipla will obviously progress much
faster.
The company is one of the three Indian pharma companies who will jointly
market the anti-anthrax drug, Ciprofloxacin, in India. The company is also to
benefit in case if USA allows the Indian companies to sell their anti-anthrax
dose over there . Anthrax has gripped the world, mainly the USA recently and is
suspected to be a form of biological terrorist attack. During 2001-02 a number
of Active Pharmaceutical Ingredients which was made in house was introduced,
This will definitely scale up the overall sales growth in the near future.
HISTORY:
Subject was incorporated on
17th August, 1935 at Mumbai in Maharashtra under the name and style
of Chemical Industrial and Pharmaceutical Laboratories Limited having Company
Registration Number 2380. In 1984, the
name of the company was changed to the present.
Mr. Khwaja Abdul Hamied, set
up in 1935 the Chemical, Industrial and Pharmaceutical Laboratories which came
to be popularly known as Cipla. He gave
the company all his patent and proprietory formulas for several drugs and
medicines.
On 17th August,
1935, the subject was registered as a public limited liability with an
authorised capital of Rs. 0.60 millions.
Subject was officially opened on September 22, 1937 when the first
products were ready for the market.
July 4, 1939 was a red letter day for the company when the Father of the
Nation, Mahatma Gandhi, honoured the factory with a visit. On October 31, 1939, the books showed an
all-time high loss of Rs. 67935. That
was the last time for the company ever recorded a deficit.
In 1942, Dr. Hamied's
blueprint for a technical industrial research was accepted by the government
and led to a birth of a Council of Scientific and Industrial Research (CSIR),
which is today the apex research body in the country.
In 1944, the company bought
the premises at Bombay Central and decided to put up a first class modern
pharmaceutical works and laboratory. It
was also decided to acquire land and buildings at Vikhroli. With severe import restrictions hampering
production, the company decided to commence manufacturing the basic chemicals
required for pharmaceuticals.
In 1946, the company's
product for hypertension, Serpinoid was exported to the American Roland
Corporation to the tune of Rs. 0.80 million.
Five years later the company entered into an agreement with a Swiss firm
for manufacturing foromycene.
In 1960, Dr. Yusuf Hamied,
the founder's son joined the company as an officer incharge of research and
development.
In 1961, the Vikhroli factory
started manufacturing diosgenin. The
company set up an agricultural research division in Bangalore in early
1973. The Bangalore factory was opened
on October 22, 1977.
The company was awarded the
CHEMEXCIL Second Award for 1978-79 in recognition of the company's role in the
international market as also the high ratio of exports to local sales.
The CHEMEXCIL First Award
followed this in 1981-82. The company
bagged the Sir P. C. Ray Award for the development of indigenous technology in
the face of stiff competition. In the
same year 1981-82, the company developed two anticancer drugs, vinlbastine and
vincristine from the common garden plant vinca rosea.
Commercial production
commenced in the company's fourth factory at Patalganga in November, 1983. In 1985, the US FDA approved the company's
bulk drug manufacturing facilities for the first time. In 1988, the company won the National Award
for successful commercialisation of publicly funded R & D. The company pioneered the manufacture of the
antiretroviral drug, zidovudine, in technological collaboration with Indian
Institute of Chemical Technology in 1993.
In 1994, the company's fifth
factory began commercial production at Kurkumbh, Maharashtra. The company launched its transparent
Rotahaler, the world's first such dry powder device, in 1995. In 1997, the palliative cancer care centre set
up by the company's foundation at Warje, near Pune.
In 1998, the company launched
lamivudine, drug of retroviral combination therapy.
In Dec 2000, the company cut
the price of its anti-AIDS drug Nevimune (scientific name : nevirapine) by 34%
to Rs 650 for a strip of ten tablets. The price was earlier Rs 985. Cipla has
slashed the price of the drug thrice reducing it from the launch price of Rs
1,350 for a strip of ten to the current price. The company attributes this to
improvements in technology that has enabled it to cut costs and pass on the
savings to consumers.
Subject is the only manufacturer of nevirapine from the
basic stage in India. This is the fourth price cut of anti-AIDS drugs effected
by company in the last three years. The last reduction was in Sep 2000 when
prices of its Lamivir, Duovir, Stavir and Nevimune brands were cut between 13 -
45% across six dosage forms.
Among the large pharma companies, the company was considered as the fastest
growing company with a pre-eminent position in anti-asthma and its foray into
high-growth areas like anti-cancer and anti-AIDS. However, current performance
is not in line with this perception.
The company is a leader in the anti-bacterial and anti-asthmatic segments in FY
2000. The company became the first player outside the US and Europe to launch
non-CFC (chlorofluorocarbons) metered dose inhalers. The company has applied
for process registration in Europe, which it is likely to get in 2002.
The market for such metered dose inhalers in the US and Europe is worth around
$ 2.5 billion and is growing at 20% p.a. Thus, even a mere 2% market share can
rake in more than Rs. 2300 millions into Cipla's kitty. The company has one of
the best R&D facilities for reverse engineering in the country. As in the
past, its R&D division continues with its focus on finding new processes
for existing products.
After growing smartly in the
domestic market, the company is now focussing on export markets. The company
has tied up with US major Andrx to supply Omeprazole, an anti-ulcer bulk drug
slated to go off patent in October. Andrx is expected to gain the 180 days
exclusivity for marketing the generic Omeprazole in the US market, post-patent
expiry in October 2001.
The company has also tied up with the US-based Zenith Goldline and United
Research Labs for marketing Flutamide (an oncology drug) and Felodipine (a
cardiovascular drug) in the US and European markets. Flutamide will go off
patent in May, while the patent for Felodipine will expire in late 2001. Cipla
is now focussing on high-margin areas like anti-AIDS, cardiovascular and
anti-cancer, in order to reduce its exposure to the highly competitive
anti-infectives segment.
Recently, in July 2001, the company has effected another round of price cuts of
its anti-AIDS drug segment. This is the forth price cut in AIDS segment during
the last nine months (last one was in May 2001). The company has cut prices its
triple drug regimen by as much as 39%. The three-drug combination of
lamivudine, stavudine and nevirapine, which was the potential to reduce the HIV
virus in the body to very low levels, will now cost the patient Rs. 0.002
millions per month down from Rs. 0.003 per month.
It has a very good product pipeline for years to come. The only threat for the
company is that the government is going to introduce the product patents post
2005. But even if it is introduced, the company expects that it is only going
to be affected after 2012 or 2015. Because, till then, the company has very
good product pipeline. But as per company reports, if government is pragmatic
in framing new patent laws, then it will obviously progress much faster.
The company is one of the three Indian pharma companies who will jointly market
the anti-anthrax drug, Ciprofloxacin, in India. The company is also to benefit
in case USA allows the Indian companies to sell their anti-anthrax dose over
there. Anthrax has gripped the world, mainly the USA recently and is suspected
to be a form of biological terrorist attack. During 2001-02 a number of Active
Pharmaceutical Ingredients which, was made in house was introduced. This will
definitely scale up the overall sales growth in the near future.
Khwaja Abdul Hamied, the
founder of company, was born on October 31, 1898. The fire of nationalism was
kindled in him when he was 15 as he witnessed a wanton act of colonial
highhandedness. The fire was to blaze within him right through his life.
In college, he found
Chemistry fascinating. He set sail for Europe in 1924 and got admission in
Berlin University as a research student of "The Technology of Barium
Compounds". He earned his doctorate three years later.
In October 1927, during the
long voyage from Europe to India, he drew up great plans for the future. He
wrote: "No modern industry could have been possible without the help of
such centres of research work where men are engaged in compelling nature to
yield her secrets to the ruthless search of an investigating chemist." His
plan found many supporters but no financiers. However, Dr Hamied was determined
to being "a small wheel, no matter how small, than be a cog in a big
wheel."
Cipla is born
In 1935, he set up The
Chemical, Industrial & Pharmaceutical Laboratories, which came to be
popularly known as Cipla. He gave the company all his patent and proprietary
formulas for several drugs and medicines, without charging any royalty. On
August 17, 1935, Cipla was registered as a public limited company with an
authorised capital of Rs 0.600 million.
The search for suitable
premises ended at 289, Bellasis Road (the present corporate office) where a
small bungalow with a few rooms was taken on lease for 20 years for Rs 350 a
month.
The company was officially
opened on September 22, 1937 when the first products were ready for the market.
The Sunday Standard wrote: "The birth of Cipla which was launched into the
world by Dr K A Hamied will be a red letter day in the annals of Bombay
Industries. The first city in India can now boast of a concern, which will
supersede all existing firms in the magnitude of its operations. India has
lagged behind in the march of science but she is now awakening from her
lethargy. The new company has mapped out an ambitious programme and with
intelligent direction and skillful production bids fair to establish a great
reputation in the East. "
July 4, 1939 was a red-letter
day for company, when the Father of the Nation, Mahatma Gandhi, honoured the
factory with a visit. He was "delighted to visit this Indian
enterprise", he noted later. From the time of the company came to the aid
of the nation gasping for essential medicines during the Second World War, the
company has been among the leaders in the pharmaceutical industry in India.
On October 31, 1939, the
books showed an alltime high loss of Rs 67,935. That was the last time the
company ever recorded a deficit.
In 1942, Dr Hamied's
blueprint for a technical industrial research institute was accepted by the
government and led to the birth of the Council of Scientific and Industrial
Research (CSIR), which is today the apex research body in the country.
In 1944, the company bought
the premises at Bombay Central and decided to put up a "first class modern
pharmaceutical works and laboratory." It was also decided to acquire land
and buildings at Vikhroli. With severe import restrictions hampering
production, the company decided to commence manufacturing the basic chemicals
required for pharmaceuticals.
In 1946, Cipla's product for
hypertension, Serpinoid , was exported to the American Roland
Corporation, to the tune of Rs 8 lakhs. Five years later, the company entered
into an agreement with a Swiss firm for manufacturing foromycene.
Dr Yusuf Hamied, the
founder's son, returned with a doctorate in chemistry from Cambridge and joined
Cipla as an officer in charge of research and development in 1960.
In 1961, the Vikhroli factory
started manufacturing diosgenin. This heralded the manufacture of several
steroids and hormones derived from diosgenin.
Milestones
1935
Dr. K. A. Hamied sets up
"The Chemical, Industrial and Pharmaceutical Laboratories Limted." in
a rented bungalow, at Bombay Central.
1941
As the Second World War cuts
off drug supplies, the company starts producing fine chemicals, dedicating all
its facilities for the war effort.
1952
Sets up first research division
for attaining self-sufficiency in technological development.
1960
Starts operations at second
plant at Vikhroli, Mumbai, producing fine chemicals with special emphasis on
natural products.
1968
The company manufactures
ampicillin for the first time in the country.
1972
Starts Agricultural Research
Division at Bangalore, for scientific cultivation of medicinal plants.
1976
The company launches
medicinal aerosols for asthma.
1980
Wins Chemexcil Award for
Excellence for exports.
1982
Fourth factory begins
operations at Patalganga, Maharashtra.
1984
Develops anti-cancer drugs,
vinblastine and vincristine in collaboration with the National Chemical
Laboratory, Pune. Wins Sir P C Ray Award for developing inhouse technology for
indigenous manufacture of a number of basic drugs.
1985
US FDA approves Cipla's bulk
drug manufacturing facilities.
1988
The company wins National
Award for Successful Commercialisation of Publicly Funded R&D.
1991
Lauches etoposide, a
breakthrough in cancer chemotherapy, in association with Indian Institute of
Chemical Technology.
The company pioneers the
manufacture of the antiretroviral drug, zidovudine, in technological
collaboration with Indian Institute of Chemical Technology, Hyderabad.
1994
The company’s fifth factory begins
commercial production at Kurkumbh, Maharashtra.
1997
Launches transparent
Rotahaler, the world's first such dry powder inhaler device now patented by
Cipla in India and abroad. The palliative cancer care centre set up by the
Cipla Foundation, begins offering free services at Warje, near Pune.
1998
Launches lamivudine, becoming
one of the few companies in the world to offer all three component drugs of
retroviral combination therapy (zidovudine and stavudine already launched).
1999
Launches Nevirapine,
antiretroviral drug, used to prevent the transmission of AIDS from mother to
child.
2000
The company became the first
company, outside the USA and Europe to launch CFC-free inhalers – ten years
before the deadline to phase out use of CFC in medicinal products.
2002
Four state-of-the-art
manufacturing facilities set up in Goa in a record time of less than twelve
months.
2003
Launches TIOVA (Tiotropium bromide), a novel
inhaled, long-acting anticholinergic bronchodilator that is employed as a
once-daily maintenance treatment for patients with chronic obstructive
pulmonary disease (COPD).
Commissioned second phase of manufacturing
operations at Goa.
2005
Set-up
state-of-the-art facility for manufacture of formulations at Baddi, Himachal
Pradesh.
BUSINESS
Subject is engaged in
manufacturing of Chemicals, Tablets and Capsules, Liquids, Creams, Aerosols,
Injections, Sterile Solution and Agrochemicals and Formulations.
It is also manufacturing and
marketing of Bulk Drugs and Formulations.
It is now ranked second in
India by ORG in terms of retail pharmaceutical sales.
Generic Names of Principal
Products/Services of Company are :-
|
Product
Description |
Item Code
No. |
|
Norfloxacin |
300490.14 |
|
Ciprofloxacin |
300420.11 |
|
Amoxycillin |
300410.04 |
The company’s products are approved by:-
v
Food and Drug
Administration (FDA), USA
v
Medicines Control Agency
(MCA), UK
v
Therapeutic Goods
Administration (TGA), Australia
v
Medicines Control
Council (MCC), South Africa
v
National Institute of
Pharmacy (NIP), Hungary
v
Pharmaceutical
Inspection Convention (PIC), Germany
v
World Health
Organisation (WHO)
Subject is one of the largest drug manufactures. It manufactures
and markets bulk drugs and formulations. It is now ranked second in India by
ORG in terms of retail pharmaceutical sales. It has manfacturing facilities at
Kurkumbh, Bangalore, Patalganda and Vikroli in Mumbai. All the bulk drug
facilities have been approved by the USA FDA and the formulation facilities
have been approved by the Medicine Control Agency, UK; the Medicine Control
Council, South Africa; the Therapeutic Goods Administration, Australia and
other international agencies.
The company has a very wide product range which includes antibiotics,
anti-bacterials, anti-asthmatics, anti-inflammatory anthelminites, anti-cancer
and cardiovasculars. In domestic formulation market, antibiotics are the
mainstay, which contributes around 50% of the company's revenue. Some of the
leading brands are Ciplox (Ciprofloxacin), Novamox (Amoxycilin) and Norflox
(Norfloxacin). The company is also has in its product portfolio Zidovir
(zidovudine, anti-AIDS drug). The company was one of the first among the Indian
pharmaceutical companies to introduce ampicillin and norfloxacin.
The company is constantly maintained its lead in introducing new drug
formulation. The company has very strong research and developement facilities
which, has been bearing fruits. Its ability to quickly duplicate a new drug
introduced elsewhere and introduce it in the Indian market has played a significant
role in building a basket of formulation brands. Being one of the earliest
entrants into the market with a new drug, generally, enables a company achieve
higher realisations. In addition to being among the early entrants, one aspect
which has given an edge to company’s strategy is the ability to market products
at a significantly lower price.
The company has developed the world's first budesonide-based,
chlorofluorocarbons (CFC) - free anti-asthma inhaler, 'Budecort CFC-free'.
Budesonide, which falls in the preventive class of anti-asthmatic drugs, is
essentially a steroid and preferred due to its safety profile. The company has
invested over Rs. 200 millions in developing CFC-free asthma products over a
period of 12 month. The product is largely being targeted at the international
markets, which are CFC-sensitive and is awaiting for registration in the
European markets. The fruits of the new product will be obtained in the coming
years, since the company expects to increase its exports through this product.
Management
review 2003-04
Industry Structure and
Developments
The pharmaceutical industry
in India continues to be highly competitive and fragmented, and has grown by 7%
during the year. It is important for the industry now to be prepared to meet
the challenges of the post 2005 product patents era.
Indian companies had an edge
in the global pharmaceutical market due to their technical skills,
state-of-the-art manufacturing facilities and relatively lower operating costs.
Increasing competitive pressures could however offset some of these advantages.
Implementation of the new
drug policy announced two years ago continued to be held back by an interim
order of the Supreme Court in public interest litigation. As a result the
uncertainty on this score continues.
Performance Review
Sales for the year crossed Rs.23,250 million,
recording an impressive 18 percent growth
over the previous year. This was achieved despite
depressed sales in the fourth quarter, mainly on account of confusion related
to the implementation of value added tax (VAT) and the levy of excise duty on
the maximum retail price (MRP) of formulations. Cipla maintained its leadership
in the domestic market, retaining its number one rank in the ORG IMS ratings
(Retail Store
Audit MAT March 2005).
Exports grew by 30 percent, exceeding Rs.l0,500
million. Both active pharmaceutical ingredients (APIs) and formulations
contributed to the growth in business in the international market. Overseas
business now forms 45 percent of the Company's total turnover.
The Company received the Express Pharma Pulse Award
for overall performance and jointly won the best exporter award.
Exports
The Company's strategic
alliances with its international marketing partners progressed as envisioned.
Technical know-how/fees
received during the year .amounted to Rs.4l5 million. The overall net profits
of the Company at Rs.4096 million grew by 39 percent. This was mainly on
account of improved product mix, optimisation of resources and higher
non-operating income.
Products
The Company yet again took a
lead in the introduction of many new products and APIs in the country. Some of
the formulations had the unique distinction of being the first in the world in
their respective therapeutic class.These were:
• Duova (tiotropium and
formoterol inhaler and rotacaps) - Long-acting combination bronchodilator for
COPD
• Duovir E Kit (lamivudine,
zidovudine and efavirenz tablets) - Novel triple-drug fixed dose combination
kit for HIV/AIDS
·
Duonase
(azelastine and fluticasone nasal spray) - New steroid-decongestant combination
spray for allergic rhinitis
• Levolin (levosalbutamol
inhaler, rotacaps, tablets and syrup) - The first chiral salbutamol
bronchodilator for asthma in these dosage forms
• Mucinac (n-acetylcysteine
effervescent tablets) - Mucolytic antioxidant • Seroflo Multi-Haler (salmeterol
and fluticasone) - The first single-action multi-dose dry powder inhaler (DPI)
for
asthma and COPD
• Voltanec (aceclofenac and
beta-cyclodextrin tablets) - Fast actingnon-steroidal anti-inflammatory drug
The Company has introduced
formulations and APIs during the year. Some of these advanced drugs have been
manufactured for the first time India by and include:
- Adesera (Adefovir Tablets) for Chronic Hepatitis
B virus Infection Adults
- Dorzox (Dorzolamide Eye Drops) for Glaucoma
- Dytor (Torsemide Tablets and Injection) - A new
loop diuretic
- Ginette 35 (Cyproterone Acetate and Tablets) For
Acne and Hirsutism
- Rizact (Rizatriptan Tablets) for Acute Migraine
- Valcivir (Valaciclovir Tablets) new for Herpes
Number of dosage forms and
APIs manufactured the Company's various facilities continue to enjoy the of
regulatory including the US FDA, MHRA UK, PIC MCC South TGA Australia, WHO
Geneva and the Department of Canada.
The Company commissioned the
second phase of manufacturing operations Goa this year. Some of these new
facilities have already been accredited by regulatory agencies.
The Company has also acquired
land at Baddi in Himacha Pradesh, where work has started on a new formulations
plant.
The Cipla Chest Research
Foundation Pune initiated number of important and academic research studies
inmedical in its very first year. The foundation also conducted training
programmes for the medical profession.
The company has maintained high
safety standards in its plants. The preservation of environment has remained a
priority. The British Safety Council Awarded the “Five Star Ratin” to the
Kurkumbh plant and also presented the coveted “Sword of Honour” to the
Patalganga plant.
It exports its products to
America (41%), Asia (5%), Australia (6%), Africa (12%), Middle East (12%) and
Europe (24%).
It is one of the leading
exporters of bulk drugs and formulations and its products are registered in
over 140 countries.
The leap in exports was a
result of the company’s constant efforts to tap new markets and introduce new
products.
Press
release
(THE ECONOMIC TIMES, Mumbai, Thursday, March
31, 2005)
Cipla topples GSK, tops the pillboard chart
Co Corners 5.5% Share Of Market
MUMBAI: Local pharmaceutical major,
Cipla, has ended GlaxoSmithKline's 28 year reign to emerge as the leading
player in the domestic retail pharmaceutical market for '04, market research
organisation ORG-IMS's Pharmaceutical Retail Audit has said.
Cipla has garnered a 5.5% share of the
domestic market at the retail level, with sales of Rs 1,128 crore, marginally
ahead of GlaxoSmithKline (GSK).
“Their ranking in the domestic market
is primarily due to the fact that we have one of the largest product portfolios
in the industry,” Cipla's joint MD, Amar Lulla, told ET. With a value growth of
6.6%, Cipla has just about outpaced the industry overall growth rate of 6.4%.
The company has over 1,000 products in
the domestic market. It has launched over 55 products in '04 alone. Cipla's
anti-asthma brand Asthalin is ranked seventh among the top 10 retail
pharmaceutical brands. Cipla's lead, however, is only a marginal Rs. 1.400
million.
Besides, the data is restricted to only
sales at the retail level and true picture of a company's standing only emerges
if sales at hospitals are added up. GSK's spokesperson said ORG-IMS's data does
not capture institutional sales or sales of vaccines, where GSK has a major
presence.
“They believe that this data does not
capture all aspects of their business,” he said. According to GSK's
spokesperson, IMS Health's (which indicates sales made to hospitals and
stockists) numbers for the year show GSK with a share of 6.45% and Cipla at
4.93%.
Shailesh Gadre, MD, ORG-IMS, said
Cipla's growth was primarily driven by the new products that it launched over
the last few years. “New launches, which have contributed to both value and
volume growth, have been the primary differentiator for Indian companies,” he
said.
According to ORG-IMS data, GSK has
registered a value growth of 2.7%, much lower than the industry average of
6.4%. But the company's market share is still at a significant 5.4%, just below
that of Cipla. Thus, GSK is still within striking distance of Cipla.
And given that a new patent regime is
being implemented, the change could come sooner than later. “The domestic
industry has focused on launching as many new molecules as possible while it
still has the window of opportunity. But over time, the dominance of building
brands will take priority,” Mr. Gadre said
Ranbaxy trails Glaxo at the third spot,
with a market share of 4.5% and sales of Rs 9190 millions. Nicholas Piramal
retains its fourth position with a market share of 4.3% and sales of Rs 8720
millions. Sun Pharma saw the maximum value growth of 13.9% at Rs 6740 millions.
The
fifth ranked domestic pharma company has 3.3% of the retail market. Dr Reddy's
Laboratories, which is ranked sixth, was the only company among the top 10 to
suffer a dip in value growth. Its sales dipped 1.7% to Rs 4990 millions, while
its market share shrank marginally to 2.4% from 2.6% last year.
Ahmedabad-based Zydus Cadila also retained its position at the seventh spot,
growing 5.4% over last year to Rs 4960 millions. Its market share was unchanged
at 2.4%. Unlisted Aristo moved up two ranks since last year to emerge as the
eight largest player in the domestic market. Aristo was the only other company
besides Sun Pharma to record double digit growth.
Its sales were up 13.2% at Rs 4760
millions. Aristo pushed MNC Abbott India down one slot. Abbott registered a
growth of 6.9% to Rs 4730 millions. Abbott, incidentally, is the only MNC other
than GSK to be on the top 10 companies. Another unlisted company, Alkem
Laboratories, has managed a slot among the top 10. The company has registered a
value growth of 7.5% at Rs 4480 millions.
The
company now has 2.2% share of the market. Alkem's entry has forced out pharma
MNC Aventis from the list. The company registered a growth of 1.3% in '03 to
garner sales of Rs 4300 millions. According to Samprada Singh, chairman of
Alkem Laboratories, the company's emphasis on brand building helped its
standing.
“We have several successful brands in the top 300 of the pharma industry. Their
product range encompasses several therapeutic segments like antibiotics, GI
products, NSAIDs and even speciality areas such as CNS, CVS and oncology,” he
added.
The company’s fixed asset of
important value includes Freehold Land, Leasehold Land, Building and Flats,
Plant and Machinery, Furniture and Fixtures and Vehicles.
UNAUDITED FINANCIAL RESULTS
FOR
THE QUARTER ENDED 31ST MARCH, 2006
(Rupees in millions)
|
- |
- |
Year Ended |
|
31.03.2006 |
||
|
1 |
Gross Sales & Income from
Operations |
31052.200 |
|
|
Less: Excise Duty |
1195.000 |
|
|
Net Sales & Income from Operations |
29857.200 |
|
2 |
Other Income |
1311.000 |
|
3 |
Total Expenditure |
|
|
- |
a) (Increase)/decrease in |
(840.800) |
|
- |
b) Consumption of Materials |
15084.400 |
|
- |
c) Staff Cost |
1473.000 |
|
- |
d) Other Expenditure |
7476.600 |
|
4 |
Interest |
114.200 |
|
5 |
Depreciation |
830.000 |
|
6 |
Profit (+)/Loss (-) before Tax |
7030.800 |
|
7 |
Provision for
Taxation |
|
|
8 |
Net Profit (+) / Loss (-) after
Tax (6-7) |
6000.800 |
|
9 |
Paid-up Equity Share Capital |
599.700 |
|
10 |
Reserves excluding Revaluation
Reserves |
|
|
11 |
Earning per Share (Rs.) |
20.01 |
|
12 |
Aggregate of Non-Promoter |
|
Notes :
- The
Company is exclusively in the pharmaceutical business segment.
- The
figures of the previous year have been recast/regrouped to render them
comparable with the figures of the current year.
- No
investor grievances were pending at the beginning of the quarter. During
the quarter ended 31st March, 2006, seven investor grievances were
received and have been suitably replied to.
- In
April 2006, the Company has raised US$ 170 million (Rs. 7622.0 millions)
through an issue of 1,10,46,310 Global Depository Receipts (GDRs). Each
GDR represents one equity share of Rs.2 each and was priced at US$ 15.39
(equivalent to Rs.690). The said GDRs have been listed on the Luxembourg
Stock Exchange and the Company has already applied to Bombay Stock
Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE)
for having the underlying shares listed.
- The
Board of Directors recommended the issue of bonus shares in the ratio of
three shares for every two shares held and the shareholders have approved
the same through a postal ballot on 21st March, 2006.The record date for
determining the members who are entitled to the bonus shares is 25th
April, 2006.
- Consequent
to the issue of GDRs and bonus shares as stated in (4) and (5) above, the
paid-up equity share capital will stand increased to Rs. 1554.6 millions.
- The
Company had challenged the inclusion of the drugs - Salbutamol,
Theophylline, Ciprofloxacin and Norfloxacin within the ambit of price
control. The petition filed by the Company had been decided in favour of
the Company by the Bombay High Court, which held that the said drugs were
outside the ambit of price control. However, on an appeal filed by the
government, the Supreme Court has remanded the matter to the Bombay High
Court for further and more detailed examination in the light of the principles
laid down by the Supreme Court. The Supreme Court had also permitted the
government to recover 50% of the amount that they had claimed was
overcharged. The government had sent notices to the Company demanding an
aggregate of Rs.1803.7 millions in respect of the said drugs, which
according to them was 50% of the amount allegedly overcharged by the
Company till July 2003. Subsequently, in separate proceedings the
Allahabad High Court had ruled that the prices fixed by the government in
respect of the said drugs were illegal and void. On an appeal filed by the
government against this ruling, the Supreme Court has stayed the judgment
of the Allahabad High Court. Further, the Supreme Court has directed that
no coercive action shall be taken against the Company till the appeal is
finally decided. The Company has received legal advice that the demand
notices of the government are not sustainable.
- Other
income includes Rs.197.0 millions being the amount settled during the
quarter against insurance claims relating to losses on account of floods.
The total amount of such claims settled during the year aggregated to
Rs.924.2 millions. These claims were mainly under Declared Value Policies
in respect of damage to finished goods at the Company's Bhiwandi godown caused
by the floods in July 2005. The total cost of the said finished goods
cannot be precisely determined in view of the impact of common and
unallocable expenses. Consequently, the full amount of claims received has
been accounted as other income.
- The
above results after being reviewed by the Audit Committee were approved
and taken on record at the meeting of the Board of Directors held on 25th
April, 2006.
By order
of the Board
For CIPLA
LIMITED
M. K. Hamied
Joint Managing Director
Financial Review - Period ended
March 2006
Financial performance:
(Rupees in Millions)
|
|
Year Ended |
|
|
31-03-2006 |
|
Domestic |
15026.500 |
|
Exports |
- |
|
Formulations |
10314.900 |
|
APIs |
4867.500 |
|
Total Exports |
15182.400 |
|
% of exports to total sales |
50.3% |
|
|
- |
|
Total Sales |
30208.900 |
|
- |
- |
|
Other operating income |
- |
|
Technology knowhow/fees |
429.000 |
|
Others |
414.300 |
|
Total |
843.300 |
|
Income from Operations |
31052.200 |
|
|
- |
|
Operating margin |
6664.000 |
|
% to income from operations |
21.5% |
|
|
- |
|
Profit before tax |
7030.8 |
|
% to income from operations |
22.6% |
|
|
- |
|
Profit after tax |
6000.800 |
|
% to income from operations |
19.3% |
Cipla
continues to grow at a very healthy pace with an overall growth of more than
57% in income from operations for the quarter ended March 2006. Currently, we
are one of the largest exporters of pharmaceutical products in India, exporting
APIs and formulation products to more than 160 countries including the U.S.,
and a number of countries in Europe, Africa, Australia, Latin America and the
Middle East. During the quarter, the international business as well as the
domestic business have recorded a remarkable growth of more than 56% and 63%
respectively.
All
the major segments including anti-asthmatics, cardiovascular and
anti-biotics/bacterials segments have shown good performance in the domestic
market. In the exports markets, anti-retrovirals, anti-malarials,
anti-asthmatics, anti-depressants and cardiovascular segments have performed
well.
During
the quarter, material cost (as a percent to income from operations) have increased
due to change in product mix and also on account of the fact that during the
quarter domestic sales has grown by more than 56% where material costs are
comparatively higher.
Excise duty has reduced mainly on account of Baddi operations which is exempt
from payment of excise duty. The increase in staff cost is due to overall
increase in managerial remuneration and increase in manpower. Other expenditure
is higher on account of overall increase in level of operations and in
particular the full impact of costs of operations of our new Baddi factory.
Interest
costs have increased due to increase in borrowings for working capital
purposes. Depreciation has increased by Rs. 102.500 millions on account of
substantial additions to assets of about Rs. 4000 millions during the year.
The provision for tax has been significantly lower this
quarter, substantially on account of increased contributions from Goa &
Baddi factory in case of formulations and Kurkumbh & Bangalore EOUs in case
of APIs.
Email
Corporate
Shares Department
Marketing
Imports
Exports
Protec Marketing Department
Treasury
MIS
Quality Control
R&D
Personnel
Purchase
Padma Awards - 2005
Dr. Yusuf K. Hamied
is a gifted entrepreneur of the Indian pharmaceutical industry. Apart from
being an accomplished scientist, he combines great business acumen and
intellect to strike the right balance between business considerations and
social and humanitarian goals. He is currently the Chairman and Managing
Director of Cipla Limited, which is renowned both locally and internationally
for its high standards, quality, efficacy and affordability of medicines.
Born on 25 th July
1936 , Dr. Hamied obtained Ph.D in Organic Chemistry from Cambridge University.
In the same year, he joined Cipla as a Research Officer. He was appointed as
its Managing Director in 1976 and Chairman in the year 1989.
Dr. Hamied has been
primarily responsible in the introduction, for the first time in India, of over
30 bulk drugs and their formulations. He is considered a pioneer of bulk drug
industry in India and has a number of research papers and international patents
to his credit. From a humble beginning, Cipla under the guidance of Dr. Hamied
is now ranked as a leader in the domestic pharmaceutical industry. The
company's turnover in 2004-2005 has exceeded Rs. 23000 millions of which 40% is
exports. Cipla today manufactures and markets a wide range of medicines not
only for the local market but also for export to 150 countries worldwide.
Dr. Hamied has
pioneered and led the global fight against HIV and AIDS. Cipla was the first to
offer the triple drug cocktail, Triomune, that can transform the life of an HIV
positive patient at a fraction of the international cost. He had been
instrumental in setting up a palliative care for cancer patients in Pune during
the 1990's. This centre follows a unique family care modal, which offers free
of cost, comfort and care to terminally ill cancer patients.
The recognitions
received by Cipla under the leadership of Dr. Y. K. Hamied include two
Chemexcil Awards for exports (1979 and 1982), Sir P. C. Ray Award for
development of indigenous technology (1983) and a National Award from the
Department of Science and Technology, Government of India for successful
commercialization of publicly funded R & D was conferred on Dr. Hamied. In
2002, he received another Lifetime Achievement award from Express Pharma Pulse.
Dr. Hamied was elected a Fellow of Christ's College, Cambridge , UK in 2004.
CMT REPORT [Corruption, Money laundering & Terrorism]
The
Public Notice information has been collected from various sources including but
not limited to: The Courts, India Prisons Service, Interpol, etc.
1] INFORMATION
ON DESIGNATED PARTY
No records exist designating subject or any of its beneficial owners, controlling shareholders or senior officers as terrorist or terrorist organization or whom notice had been received that all financial transactions involving their assets have been blocked or convicted, found guilty or against whom a judgement or order had been entered in a proceedings for violating money-laundering, anti-corruption or bribery or international economic or anti-terrorism sanction laws or whose assets were seized, blocked, frozen or ordered forfeited for violation of money laundering or international anti-terrorism laws.
2] Court
Declaration :
No records exist to suggest that subject is or was the
subject of any formal or informal allegations, prosecutions or other official
proceeding for making any prohibited payments or other improper payments to
government officials for engaging in prohibited transactions or with designated
parties.
3] Asset
Declaration :
No records exist to suggest that the property or assets of the subject are derived from criminal conduct or a prohibited transaction.
4] Record
on Financial Crime :
Charges or conviction registered
against subject: None
5] Records
on Violation of Anti-Corruption Laws :
Charges or investigation registered
against subject: None
6] Records
on Int’l Anti-Money Laundering Laws/Standards :
Charges or investigation registered
against subject: None
7] Criminal
Records
No available information exist that suggest that subject or any of its principals have been formally charged or convicted by a competent governmental authority for any financial crime or under any formal investigation by a competent government authority for any violation of anti-corruption laws or international anti-money laundering laws or standard.
8] Affiliation
with Government :
No record exists to suggest that any director or indirect owners, controlling shareholders, director, officer or employee of the company is a government official or a family member or close business associate of a Government official.
9] Compensation
Package :
Our market survey revealed that the amount of compensation sought by the subject is fair and reasonable and comparable to compensation paid to others for similar services.
10] Press Report :
No press reports / filings exists on the subject.
CORPORATE
GOVERNANCE
MIRA
INFORM as part of its Due Diligence do provide comments on Corporate Governance
to identify management and governance. These factors often have been predictive
and in some cases have created vulnerabilities to credit deterioration.
Our
Governance Assessment focuses principally on the interactions between a
company’s management, its Board of Directors, Shareholders and other financial
stakeholders.
CONTRAVENTION
Subject
is not known to have contravened any existing local laws, regulations or
policies that prohibit, restrict or otherwise affect the terms and conditions
that could be included in the agreement with the subject.
FOREIGN
EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US
Dollar |
1 |
Rs.45.07 |
|
UK
Pound |
1 |
Rs.83.67 |
|
Euro |
1 |
Rs. 57.45 |
SCORE & RATING EXPLANATIONS
|
SCORE FACTORS |
RANGE |
POINTS |
|
HISTORY |
1~10 |
9 |
|
PAID-UP CAPITAL |
1~10 |
9 |
|
OPERATING SCALE |
1~10 |
9 |
|
FINANCIAL CONDITION |
|
|
|
--BUSINESS SCALE |
1~10 |
9 |
|
--PROFITABILIRY |
1~10 |
9 |
|
--LIQUIDITY |
1~10 |
8 |
|
--LEVERAGE |
1~10 |
9 |
|
--RESERVES |
1~10 |
9 |
|
--CREDIT LINES |
1~10 |
9 |
|
--MARGINS |
-5~5 |
-- |
|
DEMERIT POINTS |
|
|
|
--BANK CHARGES |
YES/NO |
YES |
|
--LITIGATION |
YES/NO |
NO |
|
--OTHER ADVERSE INFORMATION |
YES/NO |
NO |
|
MERIT POINTS |
|
|
|
--SOLE DISTRIBUTORSHIP |
YES/NO |
NO |
|
--EXPORT ACTIVITIES |
YES/NO |
YES |
|
--AFFILIATION |
YES/NO |
YES |
|
--LISTED |
YES/NO |
YES |
|
--OTHER MERIT FACTORS |
YES/NO |
YES |
|
TOTAL |
|
80 |
This score
serves as a reference to assess SC’s credit risk and to set the amount of
credit to be extended. It is calculated from a composite of weighted scores
obtained from each of the major sections of this report. The assessed factors
and their relative weights (as indicated through %) are as follows:
Financial condition (40%) Ownership background (20%) Payment record (10%)
Credit history (10%) Market trend (10%) Operational
size (10%)
RATING
|
STATUS |
PROPOSED CREDIT LINE |
|
|
>86 |
Aaa |
Possesses an extremely
sound financial base with the strongest capability for timely payment of
interest and principal sums |
Unlimited |
|
71-85 |
Aa |
Possesses adequate
working capital. No caution needed for credit transaction. It has above
average (strong) capability for payment of interest and principal sums |
Large |
|
56-70 |
A |
Financial & operational
base are regarded healthy. General unfavourable factors will not cause fatal
effect. Satisfactory capability for payment of interest and principal sums |
Fairly Large |
|
41-55 |
Ba |
Overall operation is
considered normal. Capable to meet normal commitments. |
Satisfactory |
|
26-40 |
B |
Unfavourable &
favourable factors carry similar weight in credit consideration. Capability
to overcome financial difficulties seems comparatively below average/normal. |
Small |
|
11-25 |
Ca |
Adverse factors are
apparent. Repayment of interest and principal sums in default or expected to
be in default upon maturity |
Limited with full
security |
|
<10 |
C |
Absolute credit risk
exists. Caution needed to be exercised |
Credit not recommended |