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3decades

 

MIRA INFORM REPORT

 

 

Report No.:

500243

Report Date :

26.03.2018

 

 

 

IDENTIFICATION DETAILS

 

Name :

DR. REDDY’S LABORATORIES LIMITED

 

 

Registered Office :

8-2-337, Road No. 3, Banjara Hills, Hyderabad - 500034, Telangana 

Tel. No.:

91-40-49002900

 

 

Country :

India

 

 

Financials (as on) :

31.03.2017

 

 

Date of Incorporation :

24.02.1984

 

 

Com. Reg. No.:

36-004507

 

 

Capital Investment / Paid-up Capital :

INR 829.000 Million

 

 

CIN No.:

[Company Identification No.]

L85195TG1984PLC004507

 

 

IEC No.:

[Import-Export Code No.]

0988002833

 

 

GSTIN/UIN :

[Goods & Service Tax Registration No.]

37AAACD7999Q2ZI

 

 

TAN No.:

[Tax Deduction & Collection Account No.]

HYDD00080D

 

 

PAN No.:

[Permanent Account No.]

AAACD7999Q

 

 

Legal Form :

A Public Limited Liability Company. The Company’s Shares are Listed on the Stock Exchanges

 

 

Line of Business :

The Company’s reportable operating segments are as follows:

• Global Generics;

• Pharmaceutical Services and Active Ingredients (“PSAI”); and

• Proprietary Products.

 

Global Generics: This segment consists of the Company’s business of manufacturing and marketing prescription and over-the-counter finished pharmaceutical products ready for consumption by the patient, marketed under a brand name (branded formulations) or as generic finished dosages with therapeutic equivalence to branded formulations (generics). This segment includes the operations of the Company’s biologics business.

 

Pharmaceutical Services and Active Ingredients: This segment consists of the Company’s business of manufacturing and marketing active pharmaceutical ingredients and intermediates, also known as “API” or bulk drugs, which are the principal ingredients for finished pharmaceutical products. Active pharmaceutical ingredients and intermediates become finished pharmaceutical products when the dosages are fixed in a form ready for human consumption such as a tablet, capsule or liquid using additional inactive ingredients. This segment also includes the Company’s contract research services business and the manufacture and sale of active pharmaceutical ingredients and steroids in accordance with the specific customer requirements.

 

Proprietary Products: This segment consists of the Company’s business that focuses on the research, development, and manufacture of differentiated formulations and new chemical entities (“NCEs”). These novel products fall within the dermatology and neurology therapeutic areas and are marketed and sold through Promius Pharma, LLC. [Registered Activity]

 

 

No. of Employees :

22681 (Approximately)

 

 

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23rd January 2017)

 

MIRA’s Rating :

A++

 

Credit Rating

Explanation

Rating Comments

A++

Minimum Risk

Business dealings permissible with minimum risk of default

 

Maximum Credit Limit :

USD 331446

 

 

Status :

Excellent

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Comments :

Subject is an established company incorporated in the year 1984 and it is having excellent track records.

 

It offers global generics, Pharmaceutical Services and Active Ingredients (PSAI).

 

For the financial year 2017, the company has slightly decreased in its operational performance as compared to previous year and maintained decent profit margin of 14.24 %.

 

The rating draw comfort from the strong financial profile of the company marked by a robust capital structure and debt protection metrics.

 

Rating also factors in the long standing of the company, diversified revenue mix, its integrated presence across the value chain, healthy product pipeline and experience of the promoters in the pharmaceutical industry.

 

Share price are quoted high on stock exchange (Share Price of INR 2068 with face value of INR 05).

 

Trade relations are reported as fair. Payments are reported to be regular and as per commitments.

 

In view of strong financial base and established market position, the company can be considered good for normal business dealings at usual trade terms and conditions.

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

 

 

ECGC Country Risk Classification List

 

Country Name

Previous Rating

(30.06.2017)

Current Rating

(30.09.2017)

India

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

EXTERNAL AGENCY RATING

 

Rating Agency Name

ICRA

Rating

Long Term Rating AA+

Rating Explanation

High degree of safety and very low credit risk

Date

15.09.2017

 

Rating Agency Name

ICRA

Rating

Short-Term Rating A1+

Rating Explanation

Very strong degree of safety and carry lowest credit risk.

Date

15.09.2017

 

 

RBI DEFAULTERS’ LIST STATUS

 

Subject’s name is not enlisted as a defaulter in the publicly available RBI Defaulters’ list.

 

 

EPF (Employee Provident Fund) DEFAULTERS’ LIST STATUS

 

Subject’s name is not enlisted as a defaulter in the publicly available EPF (Employee Provident Fund) Defaulters’ list as of 31-03-2016.

 

 

BIFR (Board for Industrial & Financial Reconstruction) LISTING STATUS

 

Subject’s name is not listed as a Sick Unit in the publicly available BIFR (Board for Industrial & Financial Reconstruction) list as of 26.03.2018

 

 

IBBI (Insolvency and Bankruptcy Board of India) LISTING STATUS

 

Subject’s name is not listed in the publicly available IBBI (Insolvency and Bankruptcy Board of India) list as of report date.

 

 

INFORMATION DENIED

 

MANAGEMENT NON-COOPERATIVE (Tel No.:91-40-49002900)

 

 

LOCATIONS

 

Registered Office/ Corporate Office :

8-2-337, Road No. 3, Banjara Hills, Hyderabad - 500034, Telangana, India

Tel. No.:

91-40-49002900

Fax No.:

91-40-49002999

E-Mail :

shares@drreddys.com

mail@drreddys.com

Website :

www.drreddys.com  

 

 

API Manufacturing Facilities :
  • API Hyderabad Plant 1

Plot No. 137, 138, IDA Bollaram, Jinnaram Mandal Medak District - 502325, Telangana, India

 

  • API Hyderabad Plant 2

Plot No. 75B, 105, 110 and 111, IDA Bollaram, Jinnaram Mandal, Medak District - 502325, Telangana, India

 

  • API Hyderabad Plant 3

Plot No. 116, 116A and 126C and SY No. 157, IDA Bollaram, Jinnaram Mandal, Medak District - 502325, Telangana, India

 

  • API Hyderabad Plant 4

Plot No. 9/A, 9/B, 22A, 22B and 22C, Phase – III, IDA Jeedimetla, Ranga Reddy District – 502325, Telangana, India

 

  • API Nalgonda Plant

Peddadevulapally, Tripuraram Mandal, Nalgonda District – 502325, Telangana, India

 

  • API Srikakulam Plant

IDA, Pydibheemavaram Ransthal Mandal, Srikakulam District - 502325, Andhra Pradesh, India

 

  • API Srikakulam Plant (SEZ)

Sector No. 28 and 34 Devunipalavalasa Village, Ranastalam Mandal, Srikakulam District - 502325, Andhra Pradesh, India

 

 

Formulation Manufacturing

Facilities :
  • Formulations Hyderabad Plant 1

Plot No. 146, IDA Bollaram, Jinnaram Mandal, Medak District – 502325, Telangana, India

 

  • Formulations Hyderabad Plant 2

S Y No. 42, 45, 46 and 54 Bachupally, Qutubullapur Mandal, Ranga Reddy District – 502325, Telangana, India

 

  • Formulations Hyderabad Plant 3

S Y No. 41 Bachupally, Qutubullapur Mandal, Ranga Reddy – 502325, Telangana, India

 

  • Formulations Yanam Plant

Ward-F, Block-4, Adavipolam Yanam, Pondicherry – 533464, India

 

  • Formulations Baddi Plant 1

Khol, Nalagarh Solan, Nalagarh Road, Baddi – 173205, Himachal Pradesh, India

 

  • Formulations Vizag Sez Plant

Plot No P1-P9, Phase III Duvvada, VSEZ, Visakapatanam – 530046, Andhra Pradesh, India

 

  • Formulations Vizag Sez Plant

Plot No.Q1 to Q5 Duvvada, Visakhapatnam, FTO-IX VSEZ,  Andhra Pradesh, India

 

  • Formulations Baddi Plant 2

Village Mauja Thana, Nalagarh Baddi Road, Baddi, District Solan – 173205, Himachal Pradesh, India

 

  • Formulations Srikakulam Plant (SEZ)

Sector No. 9-13 and 17-20 Devunipalavalasa Village, Ranastalam Mandal, Srikakulam District – 532409, Andhra Pradesh, India

 

  • Biologics

Survey No.47, Bachupally Quthbullapur Mandal, Ranga Reddy District – 500043, Telangana, India

 

 

Research and Development Facility in India:
  • Integrated Product Development Organisation (IPDO)

Bachupally Village, Qutubullapur Mandal, Ranga Reddy District - 500123, Telangana, India

 

  • Aurigene Discovery Technologies Limited (ADTL), Bangalore

39-40, KIADB Industrial Area, Electronic City Phase II, Hosur Road, Bangalore - 560100, Karnataka, India

 

  • ADTL, Hyderabad

Bollaram Road, Miyapur Hyderabad - 500049, Telangana, India

 

  • Technology Development Centre Hyderabad 1

Bollaram Road, Miyapur, Hyderabad - 500049, Telangana, India

 

  • Technology Development Centre Hyderabad 2

Plot 31A, IDA, Jeedimetla, Hyderabad - 500050, Telangana, India

 

 

Facility Locations Outside India :
  • Kunshan Rotam Reddy Pharmaceutical Company Limited

No. 258, Huang Pu Jiang (M) Road, Kunshan Development Zone, Jiangsu Province P. R. China 215300

 

  • API CUERNAVACA PLANT Industrias Quimicas Falcon de Mexico S.A. de C.V.

Carretera Federal Cuernavaca-Cuautla KM 4.5 CIVAC, Jiutepec, Morelos Mexico 62578

 

  • Dr. Reddy’s Laboratories (UK) Limited

6, Riverview Road, Beverly, East Yorkshire HU 17 Old, United Kingdom

 

  • Dr. Reddy’s Laboratories (EU) Limited

Steanard Lane, Mirfield, West Yorkshire, WF 14, 8HZ, United Kingdom

 

  • Chirotech Technology Limited

410 Cambridge Science Park Milton Road, Cambridge CB4 0PE, United Kingdom

 

  • Dr. Reddy’s Laboratories Louisiana LLC

8800 Line Avenue, Shreveport, Louisiana 71106, United Sates of America

 

  • Dr. Reddy’s Laboratories Tennessee LLC

             P.O. Box 9002, 201 Industrial Drive Bristol, TN 37621- 9002, USA

 

  • Dr. Reddy’s Laboratories New York Inc.

1974 Route 145, Middleburgh, New York 12122, United Sates of America

 

  • Technology Development Centre leiden OctoPlus N.V.

Zernikedreef 12, 2333 CL Leiden, The Netherlands

 

 

DIRECTORS

 

AS ON 31.03.2017

 

Name :

Mr. Omkar Goswami

Designation :

Director

Address :

E-121, Masjid Moth, First Floor, Greater Kailash-III, New Delhi - 110048, India

Qualification:

D.Phil. (Ph.D.) Economics

Date of Appointment :

30.10.2000

DIN No.:

00004258

 

 

Name :

Dr. Prasad Raghava Menon

Designation :

Additional Director

Address :

50-F, Lovedale Pedder Road, Mumbai -400026, Maharashtra, India

Date of Appointment :

30.10.2017

DIN No.:

00005078

 

 

Name :

Mr. Bharat Narotam Doshi

Designation :

Director

Address :

8, St. Helen's Court, Peddar Road, Mumbai – 400026, Maharashtra, India

Date of Appointment :

11.05.2016

DIN No.:

00012541

 

 

Name :

Ms. Kalpana Jaisingh Morparia

Designation :

Director

Address :

B-92, Ocean Gold Co-Operative Housing Society, Twin Tower Lane, Prabhadevi, Mumbai - 400025, Maharashtra, India

Qualification:

Science and Law

Date of Appointment :

05.06.2007

DIN No.:

00046081

 

 

Name :

Mr. Gunupati Venkateswara Prasad

Designation :

Managing Director

Address :

Plot No.32, Road No.8, Banjara Hills, Hyderabad - 500034, Telangana, India

Date of Birth/Age :

57 Years

Qualification:

B.Sc. (Chem. Eng.), M.S. (Indl. Admn.)

Date of Appointment :

13.05.2014

PAN No :

AAHPP9553C

DIN No.:

00057433

 

Name :

Mr. Satish Kallam Reddy

Designation :

Whole-Time Director

Address :

8-2-576/1, Road No. 7, Banjara Hills, Hyderabad - 500034, Telangana, India

Date of Birth/Age :

50 Years

Qualification :

B. Tech., M.S. (Medicinal Chemistry)

Date of Appointment :

13.05.2014

DIN No.:

00129701

 

Name :

Mr. Anupam Pradip Puri

Designation :

Director

Address :

17 East 16th Street, Ny, New York, Ny - 10003, United States of America

Qualification :

B.A. in Economics

Date of Appointment :

04.06.2002

DIN No.:

00209113

 

Name :

Mr. Sridar Arvamudhan Iyengar

Designation :

Director

Address :

85, Fair Oaks Lane, Atherton, Ca - 94027, United States of America

Qualification :

B.Com ( Chartered Accountants)

Date of Appointment :

22.08.2011

DIN No.:

00278512

 

Name :

Mr. Bruce Leonard Andrews Carter

Designation :

Director

Address :

3915 NE Surber Dr, Seattle Wa - 98105, United States of America

Date of Birth/Age :

Ph.D. in Microbiology

Date of Appointment :

21.07.2008

DIN No.:

02331774

 

Name :

Mr. Hans Peter Hasler

Designation :

Director

Address :

P.O. Box - 255 6403, Kussnacht Am Rigi Kussnacht 6403 CH

Date of Appointment :

17.06.2016

DIN No.:

07535056

 

 

KEY EXECUTIVES

 

Name :

Mr. Gunupati Venkateswara Prasad

Designation :

Chief Executive Officer

Address :

Plot No.32, Road No.8, Banjara Hills, Hyderabad - 500034, Telangana , India

Date of Appointment :

13.05.2014

PAN No.:

AAHPP9553C

 

Name :

Mr. Saumen Chakraborty

Designation :

Chief Finance Officer

Address :

Survey No. 1009/P, Block 2B, F 900 Beverly Hills, Lodha Belleza, KPHB Colony, Hyderabad - 500016, Telangana, India

Date of Appointment :

13.05.2014

Date of Birth/Age :

50 Years

PAN No.:

AASPC7909A

 

Name :

Mr. Sandeep Poddar

Designation :

Company Secretary

Address :

Aparna Towers, Flat No. A-1004, Kothaguda, Hyderabad- 500084, Telangana, India

Date of Appointment :

22.07.2010

PAN No.:

AFPPP6507B

 

Name :

Dr. S Chandrasekhar

Designation :

President And Head, Human Resources

Qualification :

B. Tech

Date of Birth/Age :

60 Years

 

Name :

Mr. Alok Sonig

Designation :

Executive Vice President and Head-North

America Generics

Qualification :

B. E, MBA

Date of Birth/Age :

45 Years

 

Name :

Mr. Samiran Das

Designation :

Executive Vice President and Head-Global

Manufacturing Operations

Qualification :

B. Tech

Date of Birth/Age :

57 Years

 

Name :

Mr. M V Ramana

Designation :

Executive Vice President and Head-Global

Manufacturing Operations

Qualification :

MBA

Date of Birth/Age :

49 Years

 

Name :

Dr. Amit Biswas

Designation :

Executive Vice President and Head-Integrated Product Development

Qualification :

B.Tech.(Chem.), Masters (Polymer Science), Ph.D

Date of Birth/Age :

57 Years

 

Name :

Mr. Abhijit Mukherjee

Designation :

Chief Operating Officer

Qualification :

B. Tech

Date of Birth/Age :

59 Years

 

Name :

Dr. Cartikeya Reddy

Designation :

Executive Vice President and Head-Biologics

Qualification :

B. Tech. M. S. PHD

Date of Birth/Age :

47 Years

 

Name :

Mr. Ganadhish Kamat

Designation :

Executive Vice President and Global Head-Quality

Qualification :

M. Pharma, Diploma in Business management

Date of Birth/Age :

54 Years

 

Name :

Dr. K V S Ram Rao

Designation :

Sr. Vice President and Business Head-PSAI Commercial Organisation

Qualification :

B. Tech, ME, PHD

Date of Birth/Age :

54 Years

 

Name :

Mr. Anil Namboodiripad

Designation :

Senior Vice President, Proprietary Products and Head, Promius Pharma.

Qualification :

Ph.D. Physiology and Molecular Biophysics

Date of Birth/Age :

51 Years

 

 

SHAREHOLDING PATTERN

 

AS ON 30.09.2017

 

Category of shareholder

Total nos. shares held

Shareholding as a % of total no. of shares (calculated as per SCRR, 1957)As a % of

(A) Promoter & Promoter Group

44398828

26.76

(B) Public

121494696

73.24

Grand Total

165893524

100.00

 

 

 

STATEMENT SHOWING SHAREHOLDING PATTERN OF THE PROMOTER AND PROMOTER GROUP

 

Category of shareholder

Total nos. shares held

Shareholding as a % of total no. of shares (calculated as per SCRR, 1957)As a % of

A1) Indian

0.00

Individuals/Hindu undivided Family

3315328

2.00

G.V.PRASAD

1179140

0.71

G ANURADHA

1496

0.00

SAMRAJYAM REDDY KALLAM

1115360

0.67

SATISH REDDY KALLAM

1019332

0.61

Any Other (specify)

41083500

24.76

DR. REDDY'S HOLDINGS LIMITED

41083500

24.76

Sub Total A1

44398828

26.76

A2) Foreign

0.00

A=A1+A2

44398828

26.76

 

 

STATEMENT SHOWING SHAREHOLDING PATTERN OF THE PUBLIC SHAREHOLDER

 

Category & Name of the Shareholders

Total no. shares held

Shareholding % calculated as per SCRR, 1957 As a % of (A+B+C2)

B1) Institutions

0.00

Mutual Funds/

15481366

9.33

Aditya Birla Sun Life Trustee Pvt Limited and their associates

2774958

1.67

Reliance Capital and their associates

3949036

2.38

Franklin Templeton and their associates

2905732

1.75

Alternate Investment Funds

106400

0.06

Foreign Portfolio Investors

48562953

29.27

First State Investments Icvc- Stewart Investors Global Emerging Markets Leaders Fund

1947863

1.17

Teluk Kemang Investments (Mauritius) Limited

2015592

1.21

First State Investments Icvc- Stewart Investors Asia Pacific Leaders Fund

5377008

3.24

Oppenheimer Developing Markets Fund

5286227

3.19

Franklin Templeton Investment Funds

3444585

2.08

Financial Institutions/ Banks

418411

0.25

Insurance Companies

9474492

5.71

LIFE INSURANCE CORPORATION OF INDIA

5815485

3.51

Sub Total B1

74043622

44.63

B2) Central Government/ State Government(s)/ President of India

0.00

B3) Non-Institutions

0.00

Individual share capital upto Rs. 2 Lacs

14172646

8.54

Individual share capital in excess of Rs. 2 Lacs

276840

0.17

Overseas Depositories (holding DRs) (balancing figure)

22252137

13.41

JP Morgan Chase Bank, NA

22252137

13.41

Any Other (specify)

10749451

6.48

Bodies Corporate

6583324

3.97

Clearing Members

267858

0.16

NRI

1920583

1.16

Trusts

1426256

0.86

Foreign Individuals

11166

0.01

Unclaimed or Suspense or Escrow Account

425002

0.26

IEPF

115262

0.07

Sub Total B3

47451074

28.60

B=B1+B2+B3

121494696

73.24

 

 

BUSINESS DETAILS

 

Line of Business :

The Company’s reportable operating segments are as follows:

• Global Generics;

• Pharmaceutical Services and Active Ingredients (“PSAI”); and

• Proprietary Products.

 

Global Generics: This segment consists of the Company’s business of manufacturing and marketing prescription and over-the-counter finished pharmaceutical products ready for consumption by the patient, marketed under a brand name (branded formulations) or as generic finished dosages with therapeutic equivalence to branded formulations (generics). This segment includes the operations of the Company’s biologics business.

 

Pharmaceutical Services and Active Ingredients: This segment consists of the Company’s business of manufacturing and marketing active pharmaceutical ingredients and intermediates, also known as “API” or bulk drugs, which are the principal ingredients for finished pharmaceutical products. Active pharmaceutical ingredients and intermediates become finished pharmaceutical products when the dosages are fixed in a form ready for human consumption such as a tablet, capsule or liquid using additional inactive ingredients. This segment also includes the Company’s contract research services business and the manufacture and sale of active pharmaceutical ingredients and steroids in accordance with the specific customer requirements.

 

Proprietary Products: This segment consists of the Company’s business that focuses on the research, development, and manufacture of differentiated formulations and new chemical entities (“NCEs”). These novel products fall within the dermatology and neurology therapeutic areas and are marketed and sold through Promius Pharma, LLC. [Registered Activity]

 

 

Products / Services :

NIC Code

Product Description

210

Pharmaceuticals

 

 

Brand Names :

Not Available

 

 

Agencies Held :

Not Available

 

 

Exports :

Not Divulged 

 

 

Imports :

Not Divulged 

 

 

Terms :

Not Divulged 

PRODUCTION STATUS – (NOT AVAILABLE)

 

GENERAL INFORMATION

 

Suppliers :

Reference :

Not Divulged 

Name of the Person :

--

Contact No.:

--

Since How Long Known :

--

Maximum Limit Dealt :

--

Experience :

--

Remark :

--

 

 

Customers :

 

Reference :

Not Divulged 

Name of the Person :

--

Contact No.:

--

Since How Long Known :

--

Maximum Limit Dealt :

--

Experience :

--

Remark :

--

 

 

No. of Employees :

22681 (Approximately)

 

 

Bankers :

Banker Name :

State Bank of India

Branch :

Industrial Finance Branch, Somaji Guda, Hyderabad, Telangana, India

Person Name (With Designation) :

--

Contact Number :

--

Name of Account Holder :

--

Account Number :

--

Account Since (Date/Year of Account Opening) :

--

Average Balance Maintained :

--

Credit Facilities Enjoyed (CC/OD/Term Loan) :

--

Account Operation :

--

Remark :

--

 

  • IDFC Bank
  • ICICI Bank Limited
  • Axis Bank Limited
  • HDFC Bank Limited

 

 

Facilities :

SECURED LOANS

31.03.2017

INR In Million

31.03.2016

INR In Million

LONG TERM BORROWINGS

 

 

Long term maturities of finance lease obligation

(Finance lease obligations are towards lease rentals payable for the vehicles leased by the Company)

0.000

1.000

Total

0.000

1.000

 

Auditors :

 

Name :

BSR and Company LLP

Chartered Accountants

Address :

8-2-618/2, Reliance Humsafar, 4th Floor, Road No. 11, Banjara Hills, Hyderabad – 500034, Telangana, India

Tel. No.:

91-40-30465000

Fax No.:

91-40-30465299

 

 

Memberships :

Not Available

 

 

Collaborators :

Not Available

 

 

Subsidiaries including step down subsidiaries:
  • Aurigene Discovery Technologies (Malaysia) SDN BHD, Malaysia
  • Aurigene Discovery Technologies Inc., USA
  • Aurigene Discovery Technologies Limited, India
  • Beta Institut gemeinnützige GmbH, Germany
  • Betapharm Arzneimittel GmbH, Germany
  • Cheminor Investments Limited, India
  • Chienna BV, Netherlands
  • Chirotech Technology Limited, UK
  • Dr. Reddy’s Bio-sciences Limited, India
  • Dr. Reddy’s Farmaceutica Do Brasil Ltda., Brazil
  • Dr. Reddy’s Laboratories (Australia) Pty. Limited, Australia
  • Dr. Reddy’s Laboratories (EU) Limited, UK
  • Dr. Reddy’s Laboratories (Proprietary) Limited, South Africa
  • Dr. Reddy’s Laboratories (UK) Limited, UK
  • Dr. Reddy’s Laboratories Canada, Inc., Canada
  • Dr. Reddy’s Laboratories Inc., USA
  • Dr. Reddy’s Laboratories International SA, Switzerland
  • Dr. Reddy’s Laboratories LLC, Ukraine
  • Dr. Reddy’s Laboratories New York, Inc., USA
  • Dr. Reddy’s New Zealand Limited, New Zealand
  • Dr. Reddy’s Pharma SEZ Limited, India
  • Dr. Reddy’s Singapore PTE Limited, Singapore
  • Dr. Reddy’s Srl, Italy
  • Dr. Reddy’s Laboratories Japan KK, Japan (from 21 April 2015)
  • Dr. Reddy’s Laboratories Louisiana LLC, USA
  • Dr. Reddy’s Laboratories Romania S.R.L., Romania
  • Dr. Reddy’s Laboratories SA, Switzerland
  • Dr. Reddy’s Laboratories SAS, Colombia (from 14 November 2014)
  • Dr. Reddy’s Laboratories Tennessee, LLC, USA
  • Dr. Reddy’s Venezuela, C.A., Venezuela
  • DRL Impex Limited, India
  • Euro Bridge Consulting B.V., Netherlands
  • Idea2Enterprises (India) Private Limited, India
  • Industrias Quimicas Falcon de Mexico S.A. de C.V., Mexico
  • I-VEN Pharma Capital Limited, India (until 20 November 2014)
  • Lacock Holdings Limited, Cyprus
  • OctoPlus B.V., Netherlands
  • OctoPlus Development B.V., Netherlands
  • OctoPlus PolyActive Sciences B.V., Netherlands
  • OctoPlus Sciences B.V., Netherlands
  • OctoPlus Technologies B.V., Netherlands
  • OctoShare B.V., Netherlands
  • OOO Dr. Reddy’s Laboratories Limited, Russia
  • OOO DRS LLC, Russia
  • Promius Pharma LLC, USA
  • Reddy Antilles N.V., Netherlands
  • Reddy Cheminor S.A., France (under liquidation)
  • Reddy Holding GmbH, Germany
  • Reddy Netherlands B.V., Netherlands
  • Reddy Pharma Iberia SA, Spain
  • Reddy Pharma Italia S.R.L., Italy (formerly Reddy Pharma Italia S.p.A)
  • Reddy Pharma SAS, France (from 29 October 2015)
  • Reddy Specialties GmbH, Germany (till 21 November 2015)
  • Kunshan Rotam Reddy Pharmaceutical Company Limited (“Reddy Kunshan”), China

 

Joint ventures :
  • Dranu LLC, USA
  • DRSS Solar Power Private Limited, India
  • DRES Energy Private Limited, India
  • Kunshan Rotam Reddy Pharmaceutical Company Limited (Reddy Kunshan), China

 

List of other related parties with whom transactions have taken place during the current and/or previous year:
  • Dr. Reddy’s Institute of Life Sciences
  • Stamlo Hotels Limited
  • Green Park Hotels and Resorts Limited
  • Dr. Reddy’s Foundation
  • Pudami Educational Society

 

 

CAPITAL STRUCTURE

 

After 28.07.2017

 

Authorised Capital : INR 1200.000 Million

 

Issued, Subscribed & Paid-up Capital : INR 829.554 Million

 

AS ON 31.03.2017

 

Authorised Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

240000000

Equity Shares

INR 5/- each

INR 1200.000 Million

 

 

 

 

 

Issued, Subscribed & Paid-up Capital :

No. of Shares

Type

Value

Amount

 

 

 

 

165741913

Equity Shares

INR 5/- each

INR 829.000 Million

 

 

 

 

 

Reconciliation of the equity shares outstanding is set out below:

 

Equity Shares

Number of Shares

INR  In Million

Number of shares outstanding at the beginning of the year

170607653

853.000

Add : Equity shares issued pursuant to employee stock option plan

211564

1.000

Less : Equity shares bought back

(5077504)

(25.000)

Number of shares outstanding at the end of the year

165741713

829.000

 

Terms / rights attached to equity shares

 

The Company has only one class of equity shares having a par value of INR 5 per share. Each holder of equity shares is entitled to one vote per share. The Company declares and pays dividends in Indian rupees. During the year ended 31 March 2017 the amount of per share dividend proposed as distributions to equity shareholders is ` 20 (31 March 2016: INR 20; 1 April 2015: INR 20). The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting and if approved would result in a cash outflow of approximately INR 3990 including dividend distribution tax. In the event of liquidation the equity shareholders are eligible to receive the remaining assets of the Company after distribution of all preferential amounts in proportion to their shareholding.

 

Details of shareholders holding more than 5% shares in the Company

 

Name of Shareholder

Number of Shares

% holding

Dr. Reddy’s Holdings Limited

40627000

24.51

First state investments management (UK) Limited, First state investments International Limited and their associates*

14907551

8.99

 

* Does not include ADR holding

 

(d) 330142 (31 March 2016: 427348; 1 April 2015: 585454) stock options are outstanding and are to be issued by the Company upon exercise of the same in accordance with the terms of exercise under the “Dr. Reddy’s Employees Stock Option Plan 2002” and 88141 (31 March 2016: 92043; 1 April 2015: 98350) stock options are outstanding and are to be issued by the Company upon exercise of the same in accordance with the terms of exercise under the “Dr. Reddy’s Employees ADR Stock Option Plan 2007”.

 

(e) Represents 200 equity shares of INR 5/- each amount paid-up INR 500/- (rounded off to millions in the note above) forfeited due to non-payment of allotment money.

 

(f) The Company has bought back and extinguished 5077504 equity shares during the year under the buyback of equity shares plan approved by the shareholders on 1 April 2016.

 

 

 

FINANCIAL DATA

[all figures are INR Million]

 

ABRIDGED BALANCE SHEET [STANDALONE]

 

SOURCES OF FUNDS

31.03.2017

31.03.2016

31.03.2015

 

 

 

 

I.              EQUITY AND LIABILITIES

 

 

 

(1)Shareholders' Funds

 

 

 

(a) Share Capital

829.000

853.000

852.000

(b) Reserves & Surplus

115177.000

119931.000

110108.000

(c) Money received against share warrants

0.000

0.000

0.000

 

 

 

 

(2) Share Application money pending allotment

0.000

0.000

0.000

Total Shareholders’ Funds

116006.000

120784.000

110960.000

 

 

 

 

(3) Non-Current Liabilities

 

 

 

(a) long-term borrowings

4852.000

9939.000

9383.000

(b) Deferred tax liabilities (Net)

0.000

576.000

610.000

(c) Other long term liabilities

411.000

0.000

263.000

(d) long-term provisions

623.000

665.000

498.000

Total Non-current Liabilities

5886.000

11180.000

10754.000

 

 

 

 

(4) Current Liabilities

 

 

 

(a) Short term borrowings

18699.000

20896.000

21857.000

(b) Trade payables

7787.000

7192.000

7160.000

(c) Other current liabilities

14010.000

14094.000

12377.000

(d) Short-term provisions

2084.000

1706.000

1293.000

Total Current Liabilities

42580.000

43888.000

42687.000

 

 

 

 

TOTAL

164472.000

175852.000

164401.000

 

 

 

 

II.          ASSETS

 

 

 

(1) Non-current assets

 

 

 

(a) Fixed Assets

 

 

 

(i) Tangible assets

40433.000

35938.000

31294.000

(ii) Intangible Assets

323.000

8443.000

1297.000

(iii) Capital work-in-progress

5400.000

6150.000

4883.000

(iv) Intangible assets under development

7665.000

11.000

0.000

(b) Non-current Investments

18028.000

17781.000

17630.000

(c) Trade Receivable

206.000

0.000

0.000

(d)  Deferred tax assets (net)

821.000

635.000

0.000

(e) Long-term Loan and Advances

1932.000

2200.000

2283.000

(f) Other Non-current assets

3726.000

2583.000

2615.000

Total Non-Current Assets

78534.000

73741.000

60002.000

 

 

 

 

(2) Current assets

 

 

 

(a) Current investments

12991.000

32980.000

29761.000

(b) Inventories

18097.000

16996.000

17233.000

(c) Trade receivables

44054.000

38895.000

47077.000

(d) Cash and cash equivalents

668.000

2021.000

675.000

(e) Short-term loans and advances

0.000

0.000

0.000

(f) Other current assets

10128.000

11219.000

9653.000

Total Current Assets

85938.000

102111.000

104399.000

 

 

 

 

TOTAL

164472.000

175852.000

164401.000

 

 

PROFIT & LOSS ACCOUNT [STANDALONE]

 

 

PARTICULARS

31.03.2017

31.03.2016

31.03.2015

 

SALES

 

 

 

 

Income

97198.000

102919.000

100110.000

 

Other Income

5912.000

3249.000

2228.000

 

TOTAL

103110.000

106168.000

102338.000

 

 

 

 

 

Less

EXPENSES

 

 

 

 

Cost of Materials Consumed

18176.000

20727.000

22484.000

 

Purchases of Stock-in-Trade

6715.000

6104.000

5261.000

 

Changes in inventories of finished goods, work-in-progress and Stock-in-Trade

19.000

(288.000)

(289.000)

 

Employees benefits expense

18033.000

16934.000

14909.000

 

Conversion Charges

870.000

942.000

924.000

 

Other expenses

35929.000

37847.000

32910.000

 

TOTAL

79742.000

82266.000

76199.000

 

 

 

 

 

 

PROFIT/ (LOSS)  BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION

23368.000

23902.000

26139.000

 

 

 

 

 

Less

FINANCIAL EXPENSES

572.000

641.000

638.000

 

 

 

 

 

 

PROFIT / (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION

22796.000

23261.000

25501.000

 

 

 

 

 

Less

DEPRECIATION/ AMORTISATION

7351.000

6495.000

4902.000

 

 

 

 

 

 

PROFIT/ (LOSS)  BEFORE TAX

15445.000

16766.000

20599.000

 

 

 

 

 

Less

TAX

1604.000

3023.000

3805.000

 

 

 

 

 

 

PROFIT/ (LOSS)  AFTER TAX 

13841.000

13743.000

16794.000

 

 

 

 

 

 

EARNINGS IN FOREIGN CURRENCY

 

 

 

 

F.O.B. Value of Exports

77520.000

72618.000

74146.000

 

Interest on loan to subsidiaries

218.000

166.000

187.000

 

Service income and license fees

413.000

2281.000

390.000

 

Guarantee commission

0.000

21.000

132.000

 

Dividend Income

3018.000

0.000

0.000

 

Others

501.000

319.000

15.000

 

TOTAL EARNINGS

81670.000

75405.000

74870.000

 

 

 

 

 

 

IMPORTS

 

 

 

 

Raw Materials

11268.000

12003.000

11512.000

 

Components and Stores parts

2006.000

2047.000

1973.000

 

Capital Goods

 

 

 

 

TOTAL IMPORTS

13274.000

14050.000

13485.000

 

 

 

 

 

 

Earnings / (Loss) Per Share (INR)

 

 

 

Basic

83.05

80.59

98.60

Diluted

82.88

80.34

98.18

 

 

CURRENT MATURITIES OF LONG TERM DEBT DETAILS

 

Particulars

 

31.03.2017

31.03.2016

31.03.2015

 Finance lease obligations

1.000

8.000

6.000

Sales tax deferment loan from the Government of Telangana (interest free)

0.000

3.000

7.000

Total

1.000

11.000

13.000

Cash generated from operations

13387.000

31441.000

22653.000

Net cash flow from (used in) operations

10159.000

27469.000

17861.000

 

 

QUARTERLY RESULTS

 

Particulars

 

(Unaudited)

Quarter Ended 30.06.2017

(Unaudited)

Quarter Ended 30.09.2017

(Unaudited)

Quarter Ended 31.12.2017

 

 

 

 

Net Sales

20897.000

22543.000

25230.000

Total Expenditure

19413.000

19407.000

19875.000

PBIDT (Excl OI)

1484.000

3136.000

5355.000

Other Income

488.000

404.000

477.000

Operating Profit

1972.000

3540.000

5832.000

Interest

164.000

190.000

133.000

Exceptional Items

NA

NA

0.000

PBDT

1808.000

3350.000

5699.000

Depreciation

1910.000

1948.000

1983.000

Profit Before Tax

(102.000)

1402.000

3716.000

Tax

29.000

395.000

747.000

Provisions and contingencies

NA

NA

NA

Profit After Tax

(73.000)

1007.000

2969.000

Extraordinary Items

NA

NA

NA

Prior Period Expenses

NA

NA

NA

Other Adjustments

NA

NA

NA

Net Profit

(73.000)

1007.000

2969.000

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

KEY RATIOS

 

EFFICIENCY RATIOS

 

PARTICULARS

 

31.03.2017

31.03.2016

31.03.2015

Average Collection Days

(Sundry Debtors /Income * 365 Days)

165.43

137.94

171.64

 

 

 

 

Account Receivables Turnover

(Income / Sundry Debtors)

2.21

2.65

2.13

 

 

 

 

Average Payment Days

(Sundry Creditors / Purchases * 365 Days)

114.19

97.84

94.19

 

 

 

 

Inventory Turnover

(Operating Income / Inventories)

1.29

1.41

1.52

 

 

 

 

Asset Turnover

(Operating Income / Net Fixed Assets)

0.43

0.47

0.70

 

LEVERAGE RATIOS

 

PARTICULARS

 

31.03.2017

31.03.2016

31.03.2015

Debt Ratio

((Borrowing + Current Liabilities) / Total Assets)

0.29

0.31

0.32

 

 

 

 

Debt Equity Ratio

(Total Liability / Networth)

0.20

0.26

0.28

 

 

 

 

Current Liabilities to Networth

(Current Liabilities / Net Worth)

0.37

0.36

0.38

 

 

 

 

Fixed Assets to Networth

(Net Fixed Assets / Networth)

0.46

0.42

0.34

 

 

 

 

Interest Coverage Ratio

(PBIT / Financial Charges)

40.85

37.29

40.97

 

PROFITABILITY RATIOS

 

PARTICULARS

 

 

31.03.2017

31.03.2016

31.03.2015

PAT to Sales [(PAT/Sales) * 100)

%

14.24

13.35

16.78

 

 

 

 

 

Return on Total Assets

((PAT / Total Assets) * 100)

%

8.42

7.82

10.22

 

 

 

 

 

Return on Investment (ROI)

((PAT / Networth) * 100)

%

11.93

11.38

15.14

 

SOLVENCY RATIOS

 

PARTICULARS

 

31.03.2017

31.03.2016

31.03.2015

Current Ratio

(Current Assets / Current Liabilities)

2.02

2.33

2.45

 

 

 

 

Quick Ratio

((Current Assets – Inventories) / Current Liabilities)

1.59

1.94

2.04

 

 

 

 

G-Score Ratio Financial

(Networth / Total Assets)

0.71

0.69

0.67

 

 

 

 

G-Score Ratio Debt

(Debts / Equity Capital)

28.41

36.16

36.68

 

 

 

 

G-Score Ratio Liquidity

(Total Current Assets / Total Current Liabilities)

2.02

2.33

2.45

 

Total Liability = Short-term Debt + Long-term Debt + Current Maturities of Long-term debts

 

STOCK PRICES

 

Face Value

INR 5.00/-

Market Value

INR 2068.00/-

 

 

FINANCIAL ANALYSIS

[all figures are INR Million]

 

DEBT EQUITY RATIO

 

Particular

31.03.2015

31.03.2016

31.03.2017

 

INR In Million

INR In Million

INR In Million

Share Capital

852.000

853.000

829.000

Reserves & Surplus

110108.000

119931.000

115177.000

Money received against share warrants

0.000

0.000

0.000

Share Application money pending allotment

0.000

0.000

0.000

Net worth

110960.000

120784.000

116006.000

 

 

 

 

long-term borrowings

9383.000

9939.000

4852.000

Short term borrowings

21857.000

20896.000

18699.000

Current Maturities of Long term debt

13.000

11.000

1.000

Total borrowings

31253.000

30846.000

23552.000

Debt/Equity ratio

0.282

0.255

0.203

 

 

YEAR-ON-YEAR GROWTH

 

Year on Year Growth

31.03.2015

31.03.2016

31.03.2017

 

INR In Million

INR In Million

INR In Million

Sales

100110.000

102919.000

97198.000

 

 

2.806

(5.559)

 

 

 

NET PROFIT MARGIN

 

Net Profit Margin

31.03.2015

31.03.2016

31.03.2017

 

INR In Million

INR In Million

INR In Million

Sales

100110.000

102919.000

97198.000

Profit

16794.000

13743.000

13841.000

 

16.78%

13.35%

14.24%

 

 

ABRIDGED BALANCE SHEET [CONSOLIDATED]

 

SOURCES OF FUNDS

31.03.2017

31.03.2016

 

 

 

I.              EQUITY AND LIABILITIES

 

 

(1)Shareholders' Funds

 

 

(a) Share Capital

829.000

853.000

(b) Reserves & Surplus

121792.000

124845.000

(c) Money received against share warrants

0.000

0.000

 

 

 

(2) Share Application money pending allotment

0.000

0.000

Total Shareholders’ Funds

122621.000

125698.000

 

 

 

(3) Non-Current Liabilities

 

 

(a) long-term borrowings

5449.000

10685.000

(b) Deferred tax liabilities (Net)

1620.000

537.000

(c) Other long term liabilities

3434.000

2503.000

(d) long-term provisions

842.000

947.000

Total Non-current Liabilities

11345.000

14672.000

 

 

 

(4) Current Liabilities

 

 

(a) Short term borrowings

43626.000

22718.000

(b) Trade payables

10569.000

9068.000

(c) Other current liabilities

24879.000

26395.000

(d) Short-term provisions

5125.000

5290.000

Total Current Liabilities

84199.000

63471.000

 

 

 

TOTAL

218165.000

203841.000

 

 

 

II.          ASSETS

 

 

(1) Non-current assets

 

 

(a) Fixed Assets

 

 

(i) Tangible assets

50281.000

46130.000

(ii) Intangible Assets

4763.000

4650.000

(iii) Capital work-in-progress

6095.000

6626.000

(iv) Intangible assets under development

27150.000

1096.000

(b) Non-current Investments

5223.000

1986.000

(c) Deferred tax assets (net)

6784.000

5905.000

(d)  Long-term Loan and Advances

0.000

0.000

(e) Other Non-current assets

20822.000

19508.000

Total Non-Current Assets

121118.000

85901.000

 

 

 

(2) Current assets

 

 

(a) Current investments

14271.000

35034.000

(b) Inventories

28528.000

25579.000

(c) Trade receivables

38196.000

41250.000

(d) Cash and cash equivalents

3865.000

4921.000

(e) Short-term loans and advances

0.000

0.000

(f) Other current assets

12187.000

11156.000

Total Current Assets

97047.000

117940.000

 

 

 

TOTAL

218165.000

203841.000

 

 

PROFIT & LOSS ACCOUNT [CONSOLIDATED]

 

 

PARTICULARS

31.03.2017

31.03.2016

 

SALES

 

 

 

Income

141961.000

155683.000

 

Other Income

1715.000

2950.000

 

TOTAL

143676.000

158633.000

 

 

 

 

Less

EXPENSES

 

 

 

Cost of Materials Consumed

21930.000

26799.000

 

Purchases of Stock-in-Trade

13752.000

11743.000

 

Changes in inventories of finished goods, work-in-progress and Stock-in-Trade

(1233.000)

957.000

 

Conversion charges

2516.000

2423.000

 

Employees benefits expense

31068.000

31174.000

 

Other expenses

49206.000

48648.000

 

TOTAL

117239.000

119830.000

 

 

 

 

 

PROFIT/ (LOSS)  BEFORE INTEREST, TAX, DEPRECIATION AND AMORTISATION

26437.000

38803.000

 

 

 

 

Less

FINANCIAL EXPENSES

634.000

826.000

 

 

 

 

 

PROFIT / (LOSS) BEFORE TAX, DEPRECIATION AND AMORTISATION

25803.000

37977.000

 

 

 

 

Less

DEPRECIATION/ AMORTISATION

10266.000

9389.000

 

 

 

 

 

PROFIT/ (LOSS)  BEFORE TAX

15537.000

28588.000

 

 

 

 

Less

TAX

2965.000

7511.000

 

 

 

 

 

NET PROFIT FOR THE YEAR

12572.000

21077.000

 

 

 

 

Add

SHARE PROFIT OF EQUITY ACCOUNTED INVESTEES, NET TAX

349.00

229.000

 

 

 

 

 

PROFIT/ (LOSS)  AFTER TAX 

12921.000

21306.000

 

 

 

 

 

Earnings / (Loss) Per Share (INR)

77.53

124.93

 

LOCAL AGENCY FURTHER INFORMATION

 

Sr. No.

Check list by info agents

Available in Report (Yes/No)

1

Year of establishment

Yes

2

Constitution of the entity -Incorporation details

Yes

3

Locality of the entity

Yes

4

Premises details

No

5

Buyer visit details

--

6

Contact numbers

Yes

7

Name of the person contacted

No

8

Designation of contact person

No

9

Promoter’s background

Yes

10

Date of Birth of Proprietor / Partners / Directors

Yes

11

Pan Card No. of Proprietor / Partners

Yes

12

Voter Id Card No. of Proprietor / Partners

No

13

Type of business

Yes

14

Line of Business

Yes

15

Export/import details (if applicable)

No

16

No. of employees

Yes

17

Details of sister concerns

Yes

18

Major suppliers

No

19

Major customers

No

20

Banking Details

Yes

21

Banking facility details

No

22

Conduct of the banking account

--

23

Financials, if provided

Yes

24

Capital in the business

Yes

25

Last accounts filed at ROC, if applicable

Yes

26

Turnover of firm for last three years

Yes

27

Reasons for variation <> 20%

--

28

Estimation for coming financial year

No

29

Profitability for last three years

Yes

30

Major shareholders, if available

Yes

31

External Agency Rating, if available

Yes

32

Litigations that the firm/promoter involved in

No

33

Market information

--

34

Payments terms

No

35

Negative Reporting by Auditors in the Annual Report

No

 

 

 

 

COMPANY AFFAIRS:

 

The company’s standalone net revenue for the year was INR 103110.000 Million a decline of 2.88% over the previous year. In US$ terms this amounted to $ 1.59 Million. Profit before tax (PBT) was 15445.000 Million a decline of 7.88% over the previous year. In US$ terms this translates into $ 238 million.

 

DESCRIPTION OF THE COMPANY:

 

The Company is a leading India-based pharmaceutical company headquartered and having its registered office in Hyderabad Telangana India. Through its three businesses - Pharmaceutical Services and Active Ingredients Global Generics and Proprietary Products – the Company offers a portfolio of products and services including Active Pharmaceutical Ingredients (“APIs”) Custom Pharmaceutical Services (“CPS”) generics biosimilars differentiated formulations and New Chemical Entities (“NCEs”). The Company’s principal research and development facilities are located in Andhra Pradesh India; its principal manufacturing facilities are located in Telangana India; Andhra Pradesh India; Himachal Pradesh India; and its principal markets are in India Russia the United States the United Kingdom Venezuela and Germany. The Company’s shares trade on the Bombay Stock Exchange and the National Stock Exchange in India and since 11 April 2001 also on the New York Stock Exchange in the United States.

 

Dr. Reddy’s through its three businesses - Pharmaceutical Services and Active Ingredients Global Generics and Proprietary Products – offers a portfolio of products and services including APIs Custom Pharmaceutical Services generics biosimilar and differentiated formulations. Their major therapeutic areas of focus are gastrointestinal cardiovascular diabology oncology pain management and dermatology. Dr. Reddy’s operates in markets across the globe. Their major markets include – USA India Russia and CIS countries and Europe.

 

To achieve their goal they constantly work towards fulfilling their five promises namely:

1. Bringing expensive medicines within reach.

2. Addressing unmet patient needs.

3. Helping patients manage disease better.

4. Enabling and helping their partners ensure that their medicines are available where needed.

5. Working with partners to help them succeed.

 

Their three key core business segments are:

 

Their three key core business segments are:

  • Global Generics (GG) which includes branded and unbranded prescription medicine as theyll as over-the-counter (OTC)
  • Pharmaceutical products. It also includes the operations of their biologics business. Pharmaceutical Services and Active Ingredients (PSAI) which comprises Active Pharmaceutical Ingredients (API) and Custom Pharmaceutical Services (CPS).
  • Proprietary Products (PP) which consists of their differentiated formulations businesses in dermatology and neurology.

 

FY2017 has been a challenging year for the company. But before explaining the causes and reasons it is useful to give an abridged view of Dr. Reddy’s consolidated financial performance in compliance with International Financial Reporting Standards (IFRS).

 

There there five reasons for a worse performance in FY2017 compared to the previous year.

 

1. First the US market witnessed significant price erosion in some of their high value products on account of two factors: (a) new competitors also launching these drugs and pushing prices down and (b) major consolidation of their key customers and channels which gave the buyers greater pricing potheyr. In addition a high value multi-year supply contract expired during the year.

 

2. Second there theyre significant delays in the approval and launch of new products in the US market mainly due to additional queries raised by the US Food and Drug Administration (USFDA) coupled with intellectual property (IP) litigations on some of their complex generics products. Moreover some launches of key molecules such as Esomeprazole Imatinib some injectable as theyll as certain APIs theyre also delayed due to three of their plants being issued an USFDA warning letter in November 2015.

 

3. Third to some extent their India business was affected by Government imposed drug price regulations that covered some of their products.

 

4. Given the serious political economic and currency crisis in Venezuela they consciously chose to limit their business to only supplying consignments against remittance of funds from the country. Since such repatriation was minuscule so too was the size of their business.

 

5. The API business was also impacted due to lotheyr off-take of some key molecules.

 

GLOBAL GENERICS (GG)

Revenue from GG in FY2017 was INR 115.4 billion. This represented a decline of 10% over the previous year and was primarily on account of lotheyr contribution from North America Generics and Emerging Markets.

 

Revenue from North America Generics was INR 63.6 billion a fall of 16% versus FY2016. This was primarily due to delay in approvals from USFDA coupled with launch delays from their three plants that received the USFDA warning letter in November 2015 increased competition in key

 

GLOBAL PHARMACEUTICAL

 

MARKET OUTLOOK

 

Bettheyen now and 2021 the global pharmaceutical industry is expected to grow revenues by between 4% and 7% and clock nearly US$ 1.5 trillion. That will be an increase of US$ 370 billion from the estimated spending level of 2016. A somewhat other growth rate compared to what was witnessed in 2014 and 2015 is because these two years saw an unprecedented global surge in new hepatitis and cancer drugs. The US will continue to be the world’s largest pharmaceutical market.

 

As it is the case today overall revenue growth will be powered by newer medicines in developed markets and significantly increased volume in the Emerging (or ‘pharmerging’) Markets.

Faced with a growing population of the aged developed countries will continue to offset increased costs from new medicines with the use of generics coupled with greater focus on pricing and access measures. Pharmerging markets will drive growth by trying to enhance the access of medicine across the population. These countries will comprise nine of the top 20 markets of the world. And thanks to its burgeoning volumes China will be the clear number two after the US.

 

The new medicines which are expected to drive growth will be largely in the nature of ‘specialty’ products. Over the past decade the share of specialty medicines has increased from 20% in 2006 to 30% in 2016and is expected to exceed 35% by 2021. These drugs address significant unmet needs in cancer autoimmune diseases metabolic disorder nervous system dysfunction and others. Specialty medicines will approach half the pharmaceutical spend in the US and the EU4 (France Germany Italy and Spain) plus Great Britain.

 

OUTLOOK

 

In FY2017 their performance was affected due to multiple factors such as:

 

a)     Significant price erosion in their US business primarily due to new competition and also rapid channel consolidation.

 

b)     Delay in launch of their new products specifically complex generics assets due to incremental requirements lack of clear guide lines/precedence from regulatory authorities for the approval of these products plus the ‘hold’ on key product launches on account of the USFDA’s warning letter of November 2015.

 

c)     Rapid decline of the Venezuela business and price erosions in India due to government interventions through price controls.

 

d)    Decline in their PSAI business on account of lower off-take of key molecules.

 

UNSECURED LOANS:

 

Unsecured Loan

31.03.2017

INR In Million

31.03.2016

INR In Million

LONG-TERM BORROWINGS

 

 

Long term loans from banks (a)

4852.000

9938.000

SHORT-TERM BORROWINGS

 

 

Packing credit loans (b)

18698.000

20896.000

Bank overdraft

1.000

0.000

Total

23551.000

30834.000

 

Note :

 

  1. (i) The balance of long-term loan, outstanding as at 31 March 2017, comprises of External Commercial Borrowing, carrying interest rate of LIBOR plus 82.7 bps and is repayable in three equal installments in the years ending 31 March 2020 and 31 March 2021.

 

(ii) External Commercial Borrowing, outstanding as at 31 March 2016, carrying interest rate of LIBOR plus 125 bps, was repaid in the current financial year. As part of the aforesaid loan arrangements, the Company is required to comply with certain financial covenants and the Company was in compliance with such covenants as at 31 March 2017, 31 March 2016 and 1 April 2015.

 

  1. Packing credit loans for the year ended 31 March 2017, comprised of US$ denominated loans carrying interest rates of LIBOR minus 30 to plus 1 bps, RUB denominated loans carrying fixed interest rate of 9.95%, and INR denominated loans carrying fixed interest rate of 6.92% to 6.95% and Treasury bill plus 30 bps and are repayable within 6 to 12 months from the date of drawdown. Packing credit loans, for the year ended 31 March 2016, comprised of US$ and EUR denominated loans carrying interest rates of LIBOR minus 5 to plus 15 bps and RUB denominated loans carrying fixed interest rate of 10.65% to 11.57%, and are repayable within 6 to 12 months from the date of drawdown.

 

 

INDEX OF CHARGE:

 

SNo

SRN

Charge Id

Charge Holder Name

Date of Creation

Date of Modification

Amount

Address

1

Y10366897

90258811

STATE BANK OF INDIA

05/08/2002

-

12000000.0

INDUSTRAIL FINANCE BRANCH, SOMAJI GUDA, HYDERABAD, TELANGANA, INDIA

2

Y10366773

90258687

STATE BANK OF HYDERABAD

23/02/2001

-

150000000.0

OVERSEAS BRANCH, SOMAJI GUDA, HYDERABAD, TELANGANA, INDIA

3

Y10366609

90258523

CANARA BANK

23/08/1999

20/10/1999

1710000000.0

BASHIR BAGH HYDERABAD – 500029, TELANGANA, INDIA

4

Y10226989

90134184

ICICI LIMITED

29/12/1998

31/12/1998

1000000.0

L.B. BHAVAN6-3-550; SOMAJI GUDA, HYDERABAD – 500082, TELANGANA, INDIA

5

Y10366410

90258324

BANK OF BARODA B

17/08/1997

-

26000000.0

KHAIRTABAD BRANCH, HYDERABAD, TELANGANA, INDIA

6

Y10225249

90132444

THE INDUSTRIAL CREDIT and INVESTMENT CORP. OF INDIA LIMITED

19/06/1997

-

150000000.0

163; BACKBAY RECLAMATION, BOMBAY – 400020, MAHARASHTRA, INDIA

7

Y10366330

90258244

THE HONG KONG AND SHANGHAI BANKING CORP. LIMITED;

25/11/1996

15/12/2000

1000000.0

BAHRAIN OFFSHORE BANKING UNIT,

Manaman, India

8

Y10225140

90132335

THE INDUSTRIAL CREDIT AND INVESTMENT CORP. OF INDIA LIMITED;

18/10/1996

12/11/1996

100000000.0

163; BACKBAY RECLAMATION, BOMBAY  -400020, MAHARASHTRA, INDIA

9

Y10225117

90132312

SCICI LIMITED;

19/08/1996

28/08/1996

40000000.0

4 NAGARJUNA HILLS PUNJA GUTTA, HYDERABAD – 500482, INDIA

10

Y10225113

90132308

THE INDUSTRIAL CREDIT AND INVESTMENT CORP. OF INDIA LIMITED;

13/08/1996

13/08/1996

50000000.0

163; BACKBAY RECLAMATION, BOMBAY – 400020, MAHARASHTRA, INDIA

 

STANDALONE UNAUDITED STANDALONE FINANCIAL RESULTS FOR THE QUARTER ENDED AND NINE MONTH ENDED 31.12.2017

 

Particulars

Quarter ended

 

Nine Month ended

 

31.12.2017

30.09.2017

31.12.2017

 

(Unaudited)

(Unaudited)

(Unaudited)

INCOME FROM OPERATIONS

 

 

 

Net Sales

24873.000

22380.000

67974.000

License fees and service income

140.000

82.000

286.000

Other Operating Income

217.000

81.000

410.000

Total Income from Operations

25230.000

22543.000

68670.000

 

 

 

 

Other Income

477.000

404.000

1309.000

Total Income

25707.000

22947.000

69979.000

 

 

 

 

EXPENSES

 

 

 

Cost of materials consumed

4968.000

4471.000

14370.000

Purchase of Stock in Trade

1686.000

1696.000

4570.000

Changes in inventories of finished goods and work-in-progress

(185.000)

450.000

(12.700)

Employee benefits expense

4767.000

4525.000

13797.000

Selling Expenses

2749.000

2475.000

8007.000

Depreciation and Amortization expenses

1983.000

1948.000

5841.000

Finance Costs

133.000

190.000

487.000

Other Expenditure

5890.000

5790.000

18018.000

Total Expenses

21991.000

21545.000

64963.000

Profit / (Loss) before Tax

3716.000

1402.000

5016.000

Tax Expense

 

 

 

Current Tax

598.000

326.000

924.000

Deferred Tax

149.000

69.000

189.000

Profit / (Loss) after Tax

2969.000

1007.000

3903.000

Other Comprehensive Income

 

 

 

a)     Items that will not be reclassified to profit or loss

7.000

(3.000)

(2.000)

Income tax relating to items that will not be reclassified to profit or loss

 

 

 

b)    Items that will be reclassified to profit or loss

108.000

(142.000)

(76.000)

Income tax relating to items that will be reclassified to profit or loss

(37.000)

49.000

(26.000)

other comprehensive Income

78.000

(96.000)

52.000

Total other comprehensive Income

3047.000

911.000

3955.000

 

 

 

 

Paid-up Equity Share Capital (Face value INR 5/- per share)

829.000

829.000

829.000

Earnings per Share (EPS) - INR

 

 

 

Basic

17.90

6.07

23.54

Diluted

17.87

6.06

23.49

 

SEGMENT INFORMATION

(INR in Million)

 

Particulars

Quarter ended

 

Half Year ended

 

 

31.12.2017

30.09.2017

30.09.2017

 

 

Unaudited

Unaudited

Unaudited

1.

Segment wise revenue and results :

 

 

 

 

Segment revenue (inclusive of excise duty) :

 

 

 

 

a) Pharmaceutical Services and active Ingredients 

5605.000

6189.000

16473.000

 

b) Global Generics

20929.000

17774.000

56082.000

 

c) Proprietary Products

26.000

29.000

82.000

 

Total

26560.000

23992.000

72637.000

 

 

 

 

 

 

Less : Inter-segment revenue

1330.000

1449.000

3967.000

 

Add : Other unallocable income

0.000

0.000

0.000

 

Total revenue from operations

25230.000

22543.000

68670.000

 

 

 

 

 

2.

Segment results :

 

 

 

 

Profit / (Loss) before tax and Interest from each segment

 

 

 

 

a) Pharmaceutical Services and Active Ingredients

56.000

209.000

(386.000)

 

b) Global Generics

3828.000

3046.000

8474.000

 

c) Proprietary Products

(701.000)

(876.000)

(2623.000)

 

Total

3183.000

2379.000

5465.000

 

 

 

 

 

 

Less : i) Finance Cost

133.000

190.000

487.000

 

ii) Other un-allocable expenditure / (income), net

(666.000)

787.000

(38.000)

 

Total profit before tax

3716.000

1402.000

5016.000

 

 

Notes:

1. The Company adopted Indian Accounting Standards (“Ind AS”) from 1 April 2016 and accordingly these results have been prepared in accordance with the recognition and measurement principles laid down in the Ind AS 34, Interim Financial Reporting prescribed under Section 133 of the Companies Act, 2013 read with the relevant rules issued thereunder and other accounting pronouncements generally accepted in India. Financial results for all the periods presented have been prepared in accordance with the recognition and measurement principles of Ind AS 34. 

2. Post implementation of Goods and Services Tax (“GST”) with effect from 1 July 2017, revenue from operations is disclosed net of GST. Revenue from operations for the earlier periods included excise duty which is now subsumed in the GST. Revenue from operations for the nine months ended 31 December 2017 includes excise duty upto 30 June 2017. Accordingly, revenue from operations for the quarter and nine months ended 31 December 2017 are not comparable with those of the previous periods presented. 

3. The Company received a warning letter, dated 5 November 2015 from the U.S. FDA, regarding deviations with current Good Manufacturing Practices at its API manufacturing facilities in Srikakulam, Andhra Pradesh and Miryalaguda, Telangana, as well as regarding violations at its oncology formulation manufacturing facility at Duvvada, Visakhapatnam, Andhra Pradesh. The Company submitted its response to the warning letter on 7 December 2015. The Company has provided an update to the U.S. FDA on the progress of remediation in January 2016, March 2016, May 2016 and August 2016. The U.S. FDA completed the reinspection of the aforementioned facilities in March and April 2017. The Company has responded to the observations identified by the U.S. FDA. We have received Establishment Inspection report from the U.S. FDA for API manufacturing facility at Miryalaguda in June 2017 which indicates that the audit is closed. 


4. The unaudited results have been reviewed by the Audit Committee of the Board on 24 January 2018 and approved by the Board of Directors of the Company at their meeting held on 25 January 2018. 

5. The results for the quarter and nine months ended 31 December 2017 presented were subjected to a “Limited review” by the Statutory Auditors of the Company. An unqualified report was issued by them thereon.

 

FIXED ASSETS

 

Tangible assets

 

·         Land

·         Building

·         Plant and machinery

·         Electrical equipment

·         Laboratory equipment

·         Furniture and fixture

·         Office equipment

·         Vehicles

 

Intangible assets

·         Technical know how

·         Product related intangible

·         Copyrights and patents

·         Customer contracts

 

 

 

 

 

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

INR 65.13

UK Pound

1

INR 91.95

Euro

1

INR 80.33

 

 

INFORMATION DETAILS

 

Analysis Done by :

PSD

 

 

Report Prepared by :

TRUP

 

 

SCORE FACTORS

 

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

NO

--AFFILIATION

YES/NO

YES

--LISTED

YES/NO

YES

--OTHER MERIT FACTORS

YES/NO

YES

 

 

RATING EXPLANATIONS

 

Credit Rating

Explanation

Rating Comments

A++

Minimum Risk

Business dealings permissible with minimum risk of default

A+

Low Risk

Business dealings permissible with low risk of default

A

Acceptable Risk

Business dealings permissible with moderate risk of default

B

Medium Risk

Business dealings permissible on a regular monitoring basis

C

Medium High Risk

Business dealings permissible preferably on secured basis

D

High Risk

Business dealing not recommended or on secured terms only

NB

New Business

No recommendation can be done due to business in infancy stage

NT

New Trace

No recommendation can be done as the business is not traceable

 

 

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

 

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 are as follows:

 

·         Financial condition covering various ratios

·         Company background and operations size

·         Promoters / Management background

·         Payment record

·         Litigation against the subject

·         Industry scenario / competitor analysis

·         Supplier / Customer / Banker review (wherever available)

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.