Description
This is a documentation is about company analysis of Piramal healthcare.
Company Analysis – Piramal Healthcare Q) Prepare a report (maximum 1500 words) on the company mentioned below. The analysis should be based on the following parameters: Industry Analysis: 1. Industry trends: Indian and Global perspectives, recent happenings 2. PEST Analysis: Political, economic, social and technical aspects related to the industry 3. Competitor Analysis: Analyze pricing, quality, distribution and partnerships of the nearest competitor of the company 4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the industry Company Analysis: 1. Company description (a brief introduction regarding what businesses the company is into) 2. General information about the company: location of the headquarters, year of founding, shareholding pattern, number of employees, top management, etc. 3. Financial performance of the company: Sales, net profit, segment wise performance of the past 1 year 4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the company 5. Various strategies employed by the company in the course of conducting business (in the form of alliances, joint ventures, product innovation/ expansion strategies, acquisitions/ divestitures and any such strategies that you think may affect the business of the company) in past 2 years. (Make intelligent use of above points while trying to understand the strategies used by the company) a. Hierarchical: At the corporate level, business unit level and functional or department level of the firm b. Business Division: According to various products, divisions, markets, etc. c. Regional: Strategies devised as per regions, geographies, etc.
Ans) 1) Industry Trends. ? The Indian Pharmaceutical Industry is the world's third-largest in terms of volume and stands 14th in terms of value. It and is poised to grow into an industry of $ 20 billion in 2015 from the current turnover of $ 12 billion. As of today the Indian Pharma industry is dominated by foreign companies. The number of top Indian companies is low except for companies like SUN, Cadila and piramal healthcare. The Industry is distributed among 24000 companies out of which top 10 companies make up for one-third of the revenue. Apart from sales in the domestic market India is a major exporter of pharmaceuticals from which it generates a large amount of the revenue. R&D is one of the most important aspects of the pharmaceutical companies but Indian companies only invest 5-10% of the revenue as compared to 15-20% which is the global standard. In terms of global markets, India holds only 1-2% share, which is growing to grow at 10% per year. The global pharmaceutical industry has become 700+ billion industry in the last few years. Outsourcing of R&D to third party sources in on the rise with MNCs outsourcing clinical trials to smaller Indian companies. A new marketing method of increased generic penetration is used. Penetrating the rural market is the key to added sales as it is mostly untapped. Due to low cost of production of Indian drugs, export of bulk drugs has become the new trend. Fast moving health goods have taken a direct route in the consumer home, with consumers going for self-medication eg.Crocin, Insulin injection, etc.
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2) PEST Analysis: I) Political: ? Due to recent political scams, there is an air of political uncertainty in the investor camp. This has muddied the investment scenario. The Drug price fixing by the DPCO will lead to a supply crunch. DPCO nullifies the market forces from encouraging competitive pricing of goods dictated by the market. The patent act of 2005 launched by the Indian government has affected the Pharmaceutical Industry the most. Indian as well as foreign companies had take advantage by reverse engineering and manufacturing same products prior to 2005. Presence of PSU units in pharma sector, The government puts surplus generated by efficient sectors in inefficient sectors unduly subsidizing them. The excise duty has been shifted from the cost of manufacturing to the MRP, effectively increasing the final cost of the products.
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II) Economical: ? India merely invested 1% of the GDP in the healthcare sector. Now, in the 12th five year plan they have increased it to 2.5%.Such low values slacken the growth of the Industry. The taxes enforced on the pharma industry are high. There is Excise Duty (State & Central), Custom Duty, Service Tax, Profession Tax, License Fees, Royalty, Pollution Clearance Tax, Hazardous substance (Storage & Handling) license, income tax Stamp Duty and a host of other levies and charges to be paid. On an average it amounts to no less than 40-45% of the costs. India has very few Medical shops compared to its size. The transportation and infrastructure facilities are also inadequate leading to high transportation, storage and distribution costs. The per capita income of an average Indian is low therefore, spending on the healthcare takes a low priority.
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III) Social: ? In India people prefer using household treatments handed down for generations for common ailments. Ignorance of inoculation and vaccination has prevented the eradication of diseases like polio, chicken-pox, small-pox, mumps and measles. The use of magic/tantric/ozhas/hakims is prevalent in India. Poor Sanitation and polluted water sources, increasing pollution, Smoking, gutka, drinking and poor oral hygiene is adding to the healthcare problem.
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IV) Technological: ? ? ? ? Advances in Bio-technology, Stem-cell research are on the rise. Advanced automated machines have increased the output and reduced the cost. Computerization has increased the efficiency of the Pharma Industry. Ayurveda is a well recognized science and it is providing the industry with a cutting edge. Newer medication, molecules and active ingredients are being discovered. As of January 2005, the Government of India has more than 10,000 substances for patenting.
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3) Competitor Analysis: I will be doing the competitor analysis between Piramal’s Saridon and Glaxo Smith Kline’s Crocin pain relief. Product General Info. Saridon (Piramal) Piramal Healthcare stands at no.10 position in terms of revenue in India. The stock price of Piramal is at 508.10 The price of a strip of 10 is Rs.16.50 OTC drug with the following composition 150 mg of propyphenazone, 250 mg of paracetamol and 50 mg of caffeine. It is a dispersive tablet. The tablet is an OTC available at any chemist Piramal has merged with over 22 companies since 1988 with major ones being Nicholas Labs, Roche Products Limited, Global Bulk Drugs, Decision Resources Group and many more. Crocin (GSK) Glaxo Smith Kline stands at no.11 position in terms of revenue in India. The stock price of GSK is at 2079.50 The price of a strip of 10 is Rs.12.00 OTC drug with the following composition paracetamol 650 mg, caffeine 50 mg. It is a non-dispersive tablet.
Pricing
Quality
Distribution
The tablet is an OTC available at any chemist Partnerships with Pfizer, Steifel laboratories, Dr. Reddy’s Labs and others for manufacturing of certain specified products.
Partnerships
4) SWOT analysis
Strengths Weaknesses ? India is a largely untapped market ? Due to very low barriers to entry, with a population of more than a India has a fragmented Pharma billion. The penetration of modern sector with 24000 players. medicine is lower than 30% ? India accounts for 16% of the world population but the pharma sector ? The changes in lifestyle of Indians have had an impact on their accounts only for 1-2% of the healthcare decisions. world.(Low penetration) ? Indian pharmaceutical industry ? Due to high taxes and government possesses excellent chemistry and regulations, this has reduced the process reengineering skills. pricing ability of companies. ? Indian manufacturers are one of the ? Low R&D investments. lowest cost producers of drugs in the world with cost of production as low as half of other countries.
Opportunities ? Being the lowest cost producer combined with FDA approved plants, Indian companies can become a global outsourcing hub for pharmaceutical product. ? Clinical trials & research on the rise. ? Opening up of health insurance sector and the expected growth in per capita income. ? The migration into a product patent based regime will bring with it new innovative drugs where very small companies may succumb to major players.
Threats ? Non-tariff barriers imposed by developed countries. ? Threats from other low cost countries like China and Israel exist. ? Transformation of process patent to product patent (TRIPS). ? Production of duplicate drugs.
Company Analysis: 1) Company Description: ? Piramal Healthcare is a flagship company of the Piramal group and is a world leader in various business verticals. The main business arm of Piramal is their pharmaceutical products. ? Piramal health has its presence in of over 100 countries, manufacturing bases in USA, Great Britain, Sri Lanka, China and Canada and a diversified workforce representing the Piramal Group’s diversified global portfolio. Drug discovery and research is an important part of the business. The company has more than 115 issued patents and 395 pending patent applications in several countries. Piramal has acquired about 22 companies over the years with their first acquisition being Nicholas labs in 1988 to their latest Decision Resources Group of USA in 2012. Piramal healthcare has JVs and alliances with world’s leading companies like Biogen, Chiesi, PFDC, GenzymeC and Gilead. Piramal healthcare business is divided into the following businesses: a) Pharma Solutions: - It is among the top 10 companies in India, Europe and the USA. b) Critical Care: -Third largest manufacturer of inhalation anaesthetics globally. Markets its products to over 100 countries. c) Consumer Products: -One of the fastest growing in the OTC space in India with popular brands like Saridon, Lacto Calamine, I-Pill, Supractiv etc. d) Drug Discovery & Development: - Dedicated original drug discovery with focus on 4 therapeutic areas: Oncology, Inflammation, Diabetes and AntiInfectives. e) Lab Diagnostics: - It is into biochemistry analysers, haematology analysers diasys range of reagents and has a sizable market share of Lipids and no 2 selling immunoturbidimetric HbA1c kit. f) Bio-Orthopaedics: -Since 2005, Piramal Healthcare has devoted itself to bioorthopaedics research through strategic investments in innovations.
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g) Imaging Division: - Piramal Healthcare, Imaging Division, was recently created through the acquisition of worldwide rights for a molecular imaging research and development portfolio of Bayer Pharma AG. The portfolio includes rights to Florbetaben, a highly specialized molecule used in PET (Positron Emission Tomography) imaging to detect Beta-amyloid plaque which is a widely recognized marker for Alzheimer’s disease. Florbetaben has recently completed its Phase III clinical trials. h) Healthcare Information Management: - In May 2012, Piramal Healthcare Ltd acquired Decision Resources Group (DRG), a US based company, which is an independent provider of decision support tools, analytics and research for the global healthcare industry.
2) General Information of the company: ? Piramal healthcare is a pharmaceutical & healthcare company having its headquarters in Mumbai at Piramal Tower ,Ganpatrao Kadam Marg, Lower Parel. The company has offices in Hyderabad, Bangalore and countries like UK, USA, Sri Lanka, Canada and China. In the year 1947, the Company was incorporated on 26th April, under the name of Indian Schering, Ltd., U.K. as a subsidiary of British Schering, Ltd. In the year Aspro Nicholas PLC, U.K., voluntarily diluted all its shareholding in the company. From 1992 Nicholas laboratories named was changed to Nicholas Piramal Laboratories. The shareholding pattern, no.of employees and the management is mentioned below.(All the data has been taken from Economic Times from the following link http://economictimes.indiatimes.com/piramal-healthcare-ltd/shareholding/companyid13332.cms ) Holders Name Promoters Foreign Institutions General Public Financial Institutions Foreign Ocb Other Companies NBanks Mutual Funds Foreign NRI Others Foreign Industries Central Govt No. Of Shares 91553622 36189184 23023986 8634829 6434078 4212710 1692388 717244 104243 603 213 % Holding 53.06% 20.97% 13.34% 5.00% 3.73% 2.44% 0.98% 0.42% 0.06% 0.00% 0.00%
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Piramal has shown rapid increase in the number of employees from 350 in 2009 to 1100 in 2011.The employees in Piramal have been classified into two different groups. a) Corporate. b) Field Force.
The top Management of the company consists of Name Ajay G Piramal Ajay G Piramal Amit Chandra Deepak Satwalekar Goverdhan Mehta Keki Dadiseth Leonard D’Souza Leonard D’Souza N Vaghul Nandini Piramal R A Mashelkar Rajesh Laddha S Ramadorai Swati A Piramal Vijay Shah Designation CEO Chairman / Chair Person Director Director Director Director Company Secretary & Compliance Officer Secretary Director Executive Director Director Chief Financial Officer Director Vice Chairman COO & Executive Director
3) Financial performance of the company: The profit and loss sheet of Piramal Healthcare for the past 1 year is given below. ? The net sales of Piramal Healthcare for the past year have been disappointing with a drop of 438cr rupees as compared to the previous year with a dip in the total income of about 620 crores. The total expenditure has also considerably reduced but due to poor sales turnover the operating profit has been in negative. The loss for the past year has been 207 crores with the earning per share at 7.58 rs. Piramal healthcare bought an additional 5.5% stake in Vodafone taking their total stake to 11% in the telecom company to 11%.
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Profit & Loss Account
In Crores Mar'12 12 Months 1,174.00 21.29 1,152.71 0 1,347.68 60.01 619 156.36 96.81 356.48 0 0 1,288.66 -135.95 59.02 76.39 0 -17.37 199.9 -217.27 -9.5 -207.77 8.51 0 329.98 130.72 0 301.99 875.07 1,725.63
INCOME: Sales Turnover Excise Duty NET SALES Other Income TOTAL INCOME EXPENDITURE: Manufacturing Expenses Material Consumed Personal Expenses Selling Expenses Administrative Expenses Expenses Capitalised Provisions Made TOTAL EXPENDITURE Operating Profit EBITDA Depreciation Other Write-offs EBIT Interest EBT Taxes Profit and Loss for the Year Non Recurring Items Other Non Cash Adjustments Other Adjustments REPORTED PAT KEY ITEMS Preference Dividend Equity Dividend Equity Dividend (%) Shares in Issue (Lakhs)
The segment wise distribution for Piramal health care has been: (Segment wise results obtained from http://piramalhealthcare.com/fckeditor/editor/filemanager/connectors/aspx/fckeditor/userfiles /file/PHL%20-%20Q4%20FY2012%20Consolidated%20results.pdf)
4) SWOT Analysis
Strengths ? One of the biggest players in Pharmacy sector in India with a net income of 481.74 crores. ? Piramal Healthcare is one of the fastest growing players in the Rs.11, 000 crore by sales domestic consumer healthcare market. ? Piramal healthcare’s pharmaceutical contract manufacturing was awarded the number one position amongst all Indian CMOs. ? The company has more than 115 issued patents and 395 pending patent applications in several countries. Opportunities ? Rising disposable Income of Indians. ? Large pharma companies are facing patent expiries of blockbuster drugs. ? The OTC business is on the rise because of the awareness levels among Indian consumers are on the rise and they rely on more self care medication. ? Tremendous growth potential in the CMO business line.
Weaknesses ? Poor Drug discovery and research department in India. ? Too much competition with 24000 players in the pharma industry.
Threats ? Fewer new products are being approved by the FDA. ? Threat from big MNCs to Indian companies is always existent. ? Cheap drugs from China will definitely put a dent on Piramal Healthcare’s sales.
5) Strategies employed by the company in the last two years: ? ? Piramal acquired the contraceptive I-Pill a 50 crore brand from Cipla in 2010. Piramal has acquired six companies in the last two years. a) Piramal bought a 76% stake in Oxygen Bio-research which is a provider of integrated discovery services in synthetic chemistry, medicinal chemistry, computational chemistry and in vitro biology. b) Piramal acquired Bio-syntech. Biosyntech makes advanced biotherapeutic thermogels specifically designed for tissue repair and delivery of therapeutic agents. c) Piramal also acquired Bharat Serums to launch its stronghold in the injectable anaesthetic products. d) Piramal group acquired worldwide rights to the molecular imaging research and development portfolio of Bayer Pharma AG through its newly created subsidiary – Piramal Imaging SA. The deal grants Piramal rights to florbetaben, which is in the final stages of its Phase III clinical trials. e) Piramal healthcare took a big step towards building a global pharma company focused on original discovery and intellectual property rights by buying an American health information provider Decision Resources Group (DRG) provides proprietary research on healthcare trends, clinical research and mergers & acquisitions in the biopharma industry. ? ? Abbott acquired Piramal’s formulation business in May 2010 making Abbott the biggest pharmaceutical company in India. Another divestment that contributed to Piramal’s revenue was the sale of its subsidiary Piramal Diagnostic Services to Super Religare Labs for 6 billion.
Hence Piramal has divested their formulation and Diagnostic services to generate revenue and invested in new sectors like Molecular Imaging, healthcare Information and OTC’s like I-pill and I-sure. In the last two years Piramal Healthcare has forayed into different industries apart from their acquisitions in the pharmaceutical sector. Piramal has bought an additional 5.5% stake in Vodafone India increasing their stake to 11% in the company.
Piramal Healthcare Ltd has identified information technology-enabled security systems, infrastructure consulting and portfolio investment as the areas of business that it intends to enter in the future. These sectors, unrelated to the group’s existing businesses, are in addition to insurance and infrastructure finance, which the company has been actively looking at venturing into. Piramal acquired INDIAREIT Fund Advisors Private Limited & INDIAREIT Investment Management Company. These Companies are advisors to domestic and an offshore real estate funds. As on March 2012, the companies had 4200 crores of assets under management. Piramal Healthcare Ltd will be renamed as Piramal Enterprises to reflect its change from only the Healthcare business to its diverse businesses it has aggressively entered into in the past few years.
References: ? ? ? ? ? ? ? ? Piramalhealthcare.com Piramalpharmasolutions.com Wikipedia.com Economictimes.com Moneycontrol.com Thehindubusinessline.com Pharmatimes.com Indiahealthcare.in
doc_210570280.docx
This is a documentation is about company analysis of Piramal healthcare.
Company Analysis – Piramal Healthcare Q) Prepare a report (maximum 1500 words) on the company mentioned below. The analysis should be based on the following parameters: Industry Analysis: 1. Industry trends: Indian and Global perspectives, recent happenings 2. PEST Analysis: Political, economic, social and technical aspects related to the industry 3. Competitor Analysis: Analyze pricing, quality, distribution and partnerships of the nearest competitor of the company 4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the industry Company Analysis: 1. Company description (a brief introduction regarding what businesses the company is into) 2. General information about the company: location of the headquarters, year of founding, shareholding pattern, number of employees, top management, etc. 3. Financial performance of the company: Sales, net profit, segment wise performance of the past 1 year 4. SWOT Analysis: Strengths, weakness, opportunities and threats faced by the company 5. Various strategies employed by the company in the course of conducting business (in the form of alliances, joint ventures, product innovation/ expansion strategies, acquisitions/ divestitures and any such strategies that you think may affect the business of the company) in past 2 years. (Make intelligent use of above points while trying to understand the strategies used by the company) a. Hierarchical: At the corporate level, business unit level and functional or department level of the firm b. Business Division: According to various products, divisions, markets, etc. c. Regional: Strategies devised as per regions, geographies, etc.
Ans) 1) Industry Trends. ? The Indian Pharmaceutical Industry is the world's third-largest in terms of volume and stands 14th in terms of value. It and is poised to grow into an industry of $ 20 billion in 2015 from the current turnover of $ 12 billion. As of today the Indian Pharma industry is dominated by foreign companies. The number of top Indian companies is low except for companies like SUN, Cadila and piramal healthcare. The Industry is distributed among 24000 companies out of which top 10 companies make up for one-third of the revenue. Apart from sales in the domestic market India is a major exporter of pharmaceuticals from which it generates a large amount of the revenue. R&D is one of the most important aspects of the pharmaceutical companies but Indian companies only invest 5-10% of the revenue as compared to 15-20% which is the global standard. In terms of global markets, India holds only 1-2% share, which is growing to grow at 10% per year. The global pharmaceutical industry has become 700+ billion industry in the last few years. Outsourcing of R&D to third party sources in on the rise with MNCs outsourcing clinical trials to smaller Indian companies. A new marketing method of increased generic penetration is used. Penetrating the rural market is the key to added sales as it is mostly untapped. Due to low cost of production of Indian drugs, export of bulk drugs has become the new trend. Fast moving health goods have taken a direct route in the consumer home, with consumers going for self-medication eg.Crocin, Insulin injection, etc.
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2) PEST Analysis: I) Political: ? Due to recent political scams, there is an air of political uncertainty in the investor camp. This has muddied the investment scenario. The Drug price fixing by the DPCO will lead to a supply crunch. DPCO nullifies the market forces from encouraging competitive pricing of goods dictated by the market. The patent act of 2005 launched by the Indian government has affected the Pharmaceutical Industry the most. Indian as well as foreign companies had take advantage by reverse engineering and manufacturing same products prior to 2005. Presence of PSU units in pharma sector, The government puts surplus generated by efficient sectors in inefficient sectors unduly subsidizing them. The excise duty has been shifted from the cost of manufacturing to the MRP, effectively increasing the final cost of the products.
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II) Economical: ? India merely invested 1% of the GDP in the healthcare sector. Now, in the 12th five year plan they have increased it to 2.5%.Such low values slacken the growth of the Industry. The taxes enforced on the pharma industry are high. There is Excise Duty (State & Central), Custom Duty, Service Tax, Profession Tax, License Fees, Royalty, Pollution Clearance Tax, Hazardous substance (Storage & Handling) license, income tax Stamp Duty and a host of other levies and charges to be paid. On an average it amounts to no less than 40-45% of the costs. India has very few Medical shops compared to its size. The transportation and infrastructure facilities are also inadequate leading to high transportation, storage and distribution costs. The per capita income of an average Indian is low therefore, spending on the healthcare takes a low priority.
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III) Social: ? In India people prefer using household treatments handed down for generations for common ailments. Ignorance of inoculation and vaccination has prevented the eradication of diseases like polio, chicken-pox, small-pox, mumps and measles. The use of magic/tantric/ozhas/hakims is prevalent in India. Poor Sanitation and polluted water sources, increasing pollution, Smoking, gutka, drinking and poor oral hygiene is adding to the healthcare problem.
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IV) Technological: ? ? ? ? Advances in Bio-technology, Stem-cell research are on the rise. Advanced automated machines have increased the output and reduced the cost. Computerization has increased the efficiency of the Pharma Industry. Ayurveda is a well recognized science and it is providing the industry with a cutting edge. Newer medication, molecules and active ingredients are being discovered. As of January 2005, the Government of India has more than 10,000 substances for patenting.
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3) Competitor Analysis: I will be doing the competitor analysis between Piramal’s Saridon and Glaxo Smith Kline’s Crocin pain relief. Product General Info. Saridon (Piramal) Piramal Healthcare stands at no.10 position in terms of revenue in India. The stock price of Piramal is at 508.10 The price of a strip of 10 is Rs.16.50 OTC drug with the following composition 150 mg of propyphenazone, 250 mg of paracetamol and 50 mg of caffeine. It is a dispersive tablet. The tablet is an OTC available at any chemist Piramal has merged with over 22 companies since 1988 with major ones being Nicholas Labs, Roche Products Limited, Global Bulk Drugs, Decision Resources Group and many more. Crocin (GSK) Glaxo Smith Kline stands at no.11 position in terms of revenue in India. The stock price of GSK is at 2079.50 The price of a strip of 10 is Rs.12.00 OTC drug with the following composition paracetamol 650 mg, caffeine 50 mg. It is a non-dispersive tablet.
Pricing
Quality
Distribution
The tablet is an OTC available at any chemist Partnerships with Pfizer, Steifel laboratories, Dr. Reddy’s Labs and others for manufacturing of certain specified products.
Partnerships
4) SWOT analysis
Strengths Weaknesses ? India is a largely untapped market ? Due to very low barriers to entry, with a population of more than a India has a fragmented Pharma billion. The penetration of modern sector with 24000 players. medicine is lower than 30% ? India accounts for 16% of the world population but the pharma sector ? The changes in lifestyle of Indians have had an impact on their accounts only for 1-2% of the healthcare decisions. world.(Low penetration) ? Indian pharmaceutical industry ? Due to high taxes and government possesses excellent chemistry and regulations, this has reduced the process reengineering skills. pricing ability of companies. ? Indian manufacturers are one of the ? Low R&D investments. lowest cost producers of drugs in the world with cost of production as low as half of other countries.
Opportunities ? Being the lowest cost producer combined with FDA approved plants, Indian companies can become a global outsourcing hub for pharmaceutical product. ? Clinical trials & research on the rise. ? Opening up of health insurance sector and the expected growth in per capita income. ? The migration into a product patent based regime will bring with it new innovative drugs where very small companies may succumb to major players.
Threats ? Non-tariff barriers imposed by developed countries. ? Threats from other low cost countries like China and Israel exist. ? Transformation of process patent to product patent (TRIPS). ? Production of duplicate drugs.
Company Analysis: 1) Company Description: ? Piramal Healthcare is a flagship company of the Piramal group and is a world leader in various business verticals. The main business arm of Piramal is their pharmaceutical products. ? Piramal health has its presence in of over 100 countries, manufacturing bases in USA, Great Britain, Sri Lanka, China and Canada and a diversified workforce representing the Piramal Group’s diversified global portfolio. Drug discovery and research is an important part of the business. The company has more than 115 issued patents and 395 pending patent applications in several countries. Piramal has acquired about 22 companies over the years with their first acquisition being Nicholas labs in 1988 to their latest Decision Resources Group of USA in 2012. Piramal healthcare has JVs and alliances with world’s leading companies like Biogen, Chiesi, PFDC, GenzymeC and Gilead. Piramal healthcare business is divided into the following businesses: a) Pharma Solutions: - It is among the top 10 companies in India, Europe and the USA. b) Critical Care: -Third largest manufacturer of inhalation anaesthetics globally. Markets its products to over 100 countries. c) Consumer Products: -One of the fastest growing in the OTC space in India with popular brands like Saridon, Lacto Calamine, I-Pill, Supractiv etc. d) Drug Discovery & Development: - Dedicated original drug discovery with focus on 4 therapeutic areas: Oncology, Inflammation, Diabetes and AntiInfectives. e) Lab Diagnostics: - It is into biochemistry analysers, haematology analysers diasys range of reagents and has a sizable market share of Lipids and no 2 selling immunoturbidimetric HbA1c kit. f) Bio-Orthopaedics: -Since 2005, Piramal Healthcare has devoted itself to bioorthopaedics research through strategic investments in innovations.
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g) Imaging Division: - Piramal Healthcare, Imaging Division, was recently created through the acquisition of worldwide rights for a molecular imaging research and development portfolio of Bayer Pharma AG. The portfolio includes rights to Florbetaben, a highly specialized molecule used in PET (Positron Emission Tomography) imaging to detect Beta-amyloid plaque which is a widely recognized marker for Alzheimer’s disease. Florbetaben has recently completed its Phase III clinical trials. h) Healthcare Information Management: - In May 2012, Piramal Healthcare Ltd acquired Decision Resources Group (DRG), a US based company, which is an independent provider of decision support tools, analytics and research for the global healthcare industry.
2) General Information of the company: ? Piramal healthcare is a pharmaceutical & healthcare company having its headquarters in Mumbai at Piramal Tower ,Ganpatrao Kadam Marg, Lower Parel. The company has offices in Hyderabad, Bangalore and countries like UK, USA, Sri Lanka, Canada and China. In the year 1947, the Company was incorporated on 26th April, under the name of Indian Schering, Ltd., U.K. as a subsidiary of British Schering, Ltd. In the year Aspro Nicholas PLC, U.K., voluntarily diluted all its shareholding in the company. From 1992 Nicholas laboratories named was changed to Nicholas Piramal Laboratories. The shareholding pattern, no.of employees and the management is mentioned below.(All the data has been taken from Economic Times from the following link http://economictimes.indiatimes.com/piramal-healthcare-ltd/shareholding/companyid13332.cms ) Holders Name Promoters Foreign Institutions General Public Financial Institutions Foreign Ocb Other Companies NBanks Mutual Funds Foreign NRI Others Foreign Industries Central Govt No. Of Shares 91553622 36189184 23023986 8634829 6434078 4212710 1692388 717244 104243 603 213 % Holding 53.06% 20.97% 13.34% 5.00% 3.73% 2.44% 0.98% 0.42% 0.06% 0.00% 0.00%
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Piramal has shown rapid increase in the number of employees from 350 in 2009 to 1100 in 2011.The employees in Piramal have been classified into two different groups. a) Corporate. b) Field Force.
The top Management of the company consists of Name Ajay G Piramal Ajay G Piramal Amit Chandra Deepak Satwalekar Goverdhan Mehta Keki Dadiseth Leonard D’Souza Leonard D’Souza N Vaghul Nandini Piramal R A Mashelkar Rajesh Laddha S Ramadorai Swati A Piramal Vijay Shah Designation CEO Chairman / Chair Person Director Director Director Director Company Secretary & Compliance Officer Secretary Director Executive Director Director Chief Financial Officer Director Vice Chairman COO & Executive Director
3) Financial performance of the company: The profit and loss sheet of Piramal Healthcare for the past 1 year is given below. ? The net sales of Piramal Healthcare for the past year have been disappointing with a drop of 438cr rupees as compared to the previous year with a dip in the total income of about 620 crores. The total expenditure has also considerably reduced but due to poor sales turnover the operating profit has been in negative. The loss for the past year has been 207 crores with the earning per share at 7.58 rs. Piramal healthcare bought an additional 5.5% stake in Vodafone taking their total stake to 11% in the telecom company to 11%.
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Profit & Loss Account
In Crores Mar'12 12 Months 1,174.00 21.29 1,152.71 0 1,347.68 60.01 619 156.36 96.81 356.48 0 0 1,288.66 -135.95 59.02 76.39 0 -17.37 199.9 -217.27 -9.5 -207.77 8.51 0 329.98 130.72 0 301.99 875.07 1,725.63
INCOME: Sales Turnover Excise Duty NET SALES Other Income TOTAL INCOME EXPENDITURE: Manufacturing Expenses Material Consumed Personal Expenses Selling Expenses Administrative Expenses Expenses Capitalised Provisions Made TOTAL EXPENDITURE Operating Profit EBITDA Depreciation Other Write-offs EBIT Interest EBT Taxes Profit and Loss for the Year Non Recurring Items Other Non Cash Adjustments Other Adjustments REPORTED PAT KEY ITEMS Preference Dividend Equity Dividend Equity Dividend (%) Shares in Issue (Lakhs)
The segment wise distribution for Piramal health care has been: (Segment wise results obtained from http://piramalhealthcare.com/fckeditor/editor/filemanager/connectors/aspx/fckeditor/userfiles /file/PHL%20-%20Q4%20FY2012%20Consolidated%20results.pdf)
4) SWOT Analysis
Strengths ? One of the biggest players in Pharmacy sector in India with a net income of 481.74 crores. ? Piramal Healthcare is one of the fastest growing players in the Rs.11, 000 crore by sales domestic consumer healthcare market. ? Piramal healthcare’s pharmaceutical contract manufacturing was awarded the number one position amongst all Indian CMOs. ? The company has more than 115 issued patents and 395 pending patent applications in several countries. Opportunities ? Rising disposable Income of Indians. ? Large pharma companies are facing patent expiries of blockbuster drugs. ? The OTC business is on the rise because of the awareness levels among Indian consumers are on the rise and they rely on more self care medication. ? Tremendous growth potential in the CMO business line.
Weaknesses ? Poor Drug discovery and research department in India. ? Too much competition with 24000 players in the pharma industry.
Threats ? Fewer new products are being approved by the FDA. ? Threat from big MNCs to Indian companies is always existent. ? Cheap drugs from China will definitely put a dent on Piramal Healthcare’s sales.
5) Strategies employed by the company in the last two years: ? ? Piramal acquired the contraceptive I-Pill a 50 crore brand from Cipla in 2010. Piramal has acquired six companies in the last two years. a) Piramal bought a 76% stake in Oxygen Bio-research which is a provider of integrated discovery services in synthetic chemistry, medicinal chemistry, computational chemistry and in vitro biology. b) Piramal acquired Bio-syntech. Biosyntech makes advanced biotherapeutic thermogels specifically designed for tissue repair and delivery of therapeutic agents. c) Piramal also acquired Bharat Serums to launch its stronghold in the injectable anaesthetic products. d) Piramal group acquired worldwide rights to the molecular imaging research and development portfolio of Bayer Pharma AG through its newly created subsidiary – Piramal Imaging SA. The deal grants Piramal rights to florbetaben, which is in the final stages of its Phase III clinical trials. e) Piramal healthcare took a big step towards building a global pharma company focused on original discovery and intellectual property rights by buying an American health information provider Decision Resources Group (DRG) provides proprietary research on healthcare trends, clinical research and mergers & acquisitions in the biopharma industry. ? ? Abbott acquired Piramal’s formulation business in May 2010 making Abbott the biggest pharmaceutical company in India. Another divestment that contributed to Piramal’s revenue was the sale of its subsidiary Piramal Diagnostic Services to Super Religare Labs for 6 billion.
Hence Piramal has divested their formulation and Diagnostic services to generate revenue and invested in new sectors like Molecular Imaging, healthcare Information and OTC’s like I-pill and I-sure. In the last two years Piramal Healthcare has forayed into different industries apart from their acquisitions in the pharmaceutical sector. Piramal has bought an additional 5.5% stake in Vodafone India increasing their stake to 11% in the company.
Piramal Healthcare Ltd has identified information technology-enabled security systems, infrastructure consulting and portfolio investment as the areas of business that it intends to enter in the future. These sectors, unrelated to the group’s existing businesses, are in addition to insurance and infrastructure finance, which the company has been actively looking at venturing into. Piramal acquired INDIAREIT Fund Advisors Private Limited & INDIAREIT Investment Management Company. These Companies are advisors to domestic and an offshore real estate funds. As on March 2012, the companies had 4200 crores of assets under management. Piramal Healthcare Ltd will be renamed as Piramal Enterprises to reflect its change from only the Healthcare business to its diverse businesses it has aggressively entered into in the past few years.
References: ? ? ? ? ? ? ? ? Piramalhealthcare.com Piramalpharmasolutions.com Wikipedia.com Economictimes.com Moneycontrol.com Thehindubusinessline.com Pharmatimes.com Indiahealthcare.in
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