Corporate Presentation

Ipca Laboratories Limited

Partnering Healthcare Globally

July11

Company Overview
Incorporation Present Management since Total Income F.Y. 2010-11 Exports F.Y. 2010-11 Number of Employees Business Model 1949 1975 Rs. 18,895 Mn. USD 415 Mn. Rs. 10,252 Mn. USD 225 Mn. Over 8,900 Fully integrated Pharmaceutical company producing Branded & Generics Formulations, APIs & Intermediates.

Manufacturing Facilities
Formulations
Location
Athal (Silvassa)

Dosage Form
Tablets & Capsules Tablets, Liquids & Injectables Betalactum Tablets, Capsules & Dry Syrups. Tablets & Capsules

Approvals / Inspections
UK-MHRA, TGA-Australia, MCC-South Africa, HPB Canada, WHO-Geneva MCC-S.Africa UK- MHRA, MCC South Africa, UK - MHRA, US - FDA. TGA-Australia, HPB Canada

Ratlam (Madhya Pradesh) Kandla (Gujarat)

Silvassa

Manufacturing Facilities
Formulations
Location
Dehradun (Uttaranchal) Indore (SEZ) (Madhya Pradesh)

Dosage Form

Approvals / Inspections

Tablets & Cephalosporin WHO - GMP Injectables Tablets & Capsules UK MHRA

Manufacturing Facilities
Active Pharmaceutical Ingredients (APIs)
Location
Ratlam (Madhya Pradesh) Indore (Madhya Pradesh) Aurangabad (Maharashtra)

Approvals / Inspections
US FDA ,TGA Australia EDQM, Danish Regulatory Authority, PMDA-Japan, WHO-Geneva WHO - GMP WHO - GMP

The company has taken effective steps for setting up a new green field API manufacturing facility at Vadodara (Gujarat)

Manufacturing Facilities
Projects Under Implementation
Location
Sikkim

Dosage Form / Capacity

Dosage Form Tablets & Capsules

Approvals / Inspections
-

Sikkim formulations manufacturing Plant started commercial Production in July 2011.

Revenue Break-up (2010-11)

Total Revenue Breakup Total Revenue Breakup

Formulations 74%

APIs 26%

Exports 54%

Domestic 46%

Formulations 67%

APIs 33%

Domestic Breakup

Exports Breakup

Formulations 83%

APIs 17%

Revenue Break-up
Rs. Mn. Branded Formulations Generic Formulations Total Formulations API / Intermediates Others Total Income
6964

2010-11 Domestic Exports

6964 1558

Total
8522

2009-10 Domestic Exports

5898 1298

Total
7196

Growth

18.4%

5359 6917

5359 13881

80 5978

3594 4892

3674 10870

45.9% 27.7%

1443 236 8643 13.7%

3335

4778 236

1416 200 7594

3169

4585 200

4.2%

10252 27.2%

18895 20.7%

8061

15655

20.7%

Growth

Financials
FY 2010-11 (Rs. Mn.) Total Income EBIDT EBIDT % PBT # PBT % PAT # PAT % 18895 3785 20.12% 3437 18.27% 2554 13.58% 56 75 USD (Mn.) 415 83 FY 2009-10 (Rs. Mn.) USD (Mn.) % Growth 15655 3319 21.37% 2717 17.50% 2092 13.47% 46 22.1% 60 26.5% 343 73 20.7% 14.0%

# After forex gain of Rs.433Mn as against forex gain of Rs.58Mn for previous year.

Financials
Profitability to Net Income
FY 2010-2011 FY 2009-2010 FY 2008-2009

PBIDT PBT PAT (before exceptional items) Net Profit (after exceptional items)

20.12% 18.27% 14.11% 13.58%

21.37% 17.50% 13.47% 13.47%

21.03% 9.79% 7.96% 7.16%

Financials
Business Characteristics
FY 2010-2011 FY 2009-2010 FY 2008-2009 Return on Capital Employed % (PBIT/Capital Employed) Return on Net W orth % (PAT/Net W orth) Fixed Asset Turnover Ratio (Total Income/Net Fixed Assets) Capital Employed Turnov er Ratio (Total Income/ Capital Employed) Asset Cov erage Ratio (to term loan) (Net Fixed Assets/Long Term Loans) Long Term Debt Equity Ratio (Long Term Loan/ NetW orth) Debtors Turnov er Ratio (Days) (Debtors/ Turnov er)x365 Creditors Turnov er Ratio (Days) (Creditors/ Purchases)x365 Inv entory Turnov er Ratio (Days) (Inventory/ Turnov er)x365

26.14% 25.18%

24.82% 23.91%

16.35% 15.88%

2.33 1.35

2.32 1.33

2.20 1.36

3.04 0.25 91 56 90

3.07 0.25 93 60 88

2.51 0.36 99 62 86

Financials
Growth
FY 2010-2011 FY 2009-2010 FY 2008-2009

Total Income Domestic Sales Export Sales PBIDT PBT PAT (before exceptional items) Net Profit (after exceptional items)

20.7% 13.7% 27.2% 14.0% 26.5% 26.8% 22.1%

22.7% 26.4% 18.5% 23.9% 118.0% 106.3% 129.3%

20.4% 15.6% 26.9% 45.8% -29.5% -28.1% -35.4%

Financials
Q1 2011-12 (Rs. Mn.) Total Income EBIDT EBIDT % PBT # PBT % PAT # PAT % 5326 952 17.96% 832 15.62% 617 11.58% 14 18 USD (Mn.) 117 21 Q1 2010-11 (Rs. Mn.) USD (Mn.) % Growth 4205 712 17.04% 511 12.15% 388 9.22% 9 59.0% 11 62.8% 92 16 26.7% 33.7%

# After forex gain of Rs.91Mn as against forex loss of Rs.29Mn for previous year.

Revenue Break-up (Formulations)

Contribution of Therapeutic Groups
2009-10 Exports 41% 21% 7% 19% 2% 1% 1% 8% 100% Domestic 28% 26% 17% 9% 7% 4% 4% 4% 1% 100% Therapeutic Segment Cardiovasculars & Anti-diabetics Non steroidal anti-inflammatory drugs (NSAID) Anti-malarials Anti-bacterials Gastro-intestinal (GI) products Neuro psychiatry Cough Preparations Dermatology Nutraceuticals Others Total 2010-11 Exports 41% 20% 19% 11% 1% 3% 1% 4% 100% Domestic 27% 28% 17% 8% 6% 4% 4% 4% 1% 1% 100%

Branded Formulations Domestic

Formulations Business - Domestic

All India Rank ORG-IMS : 26th (MAT June11). 23 Depots & 2 C&F agents. 13 Therapy Focused Marketing Divisions including 2 new divisions - Ipca Pain Management & Ipca Dynamix. Field Strength - 5400 1500 Wholesalers. 4 brands among top 300 brands (HCQS, Lariago, Perinorm & Rapither) Market leaders in Anti-malarials & Rheumatoid Arthritis.

Formulations Business - Domestic

Sales Rs.Mn. Sales USD Mn. CAGR = 17%
4319 95 5978 131 4766 6964 153

105

2007-08

2008-09

2009-10

2010-11

Formulations Business - Domestic

New Product Sales
Value Year of Launch (Rs. Mn.)
Before 2006-07 2006-07 2007-08 2008-09 2009-10 2010-11
New products launched in last 5 yrs

% Contribution

5827 203 433 104 98 149 987 6814

86% 3% 6% 2% 1% 2% 14% 100%

Grand Total

Formulations Business - Domestic

Future Growth Drivers
The company introduced 25 new Brands in the domestic market during 2010-11 Increased penetration through field force expansion. Clinical research as a tool to launch innovative combination formulations / NDDS. Strong Brand building with focused promotion. In licensing/ out licensing to build business in the promoted therapy. Portfolio optimization, strategies to identify need gaps to build, enter, maintain and exit approach.

Domestic API Business

Domestic API Business

Sales Rs.Mn. Sales USD Mn. CAGR = 25%
1083
24

1416
31

1443
32

741
16

2007-08

2008-09

2009-10

2010-11

API sales does not include captive consumption (FY 2010-11 Rs. 2271 Mn / USD 50 Mn.)

International Business

International Business
Exports to over 110 countries. Recognised Trading House. Among Top 10 Pharma exporter from India. 54% sales from exports. Field-force to promote brands in 40 countries of CIS, South East Asia, Middle East, Latin America and Africa.

International Business
Marketing offices in Russia, Ukraine, Vietnam, Phillipines, Kenya, Columbia, Sri Lanka, Malaysia & Nigeria (subsidiary company). Formulation Dossiers for Branded formulations registered in 70 countries. Forbes Asia has selected Ipca for 3 consecutive years 2003, 2004 ,2005 as one of the Best under a billion companies outside US. Forbes Inc. selected Ipca as one of the Best under a Billion Forbes Globals 200 Best Small companies in 2007.

International Business
Sales Rs.Mn. Sales USD Mn. CAGR = 24%
8061 6804
149 177

10252
225

5363
118

2007-08

2008-09

2009-10

2010-11

International Business
Continent-wise Exports 2010-11
Continent EUROPE AFRICA ASIA CIS AMERICAS AUSTRALASIA Total Formulations 2800 1716 258 742 1159 242 6917 Bulk drugs/ Intermediates 1080 329 858 38 951 79 3335 Total 3880 2045 1116 780 2110 321 10252

(Rs Mn)

Cont.% 38% 20% 11% 8% 20% 3% 100%

International Formulations Business

International Business - Formulations

Sales Rs.Mn. Sales USD Mn. CAGR = 27%
4372 96 3420 4892 6917 152

107

75

2007-08

2008-09

2009-10

2010-11

International Business Branded Formulations

International Business Branded Formulations

Sales Rs.Mn. Sales USD Mn. CAGR 12%
1129
25

1684 37 1298
28

1558
34

2007-08

2008-09

2009-10

2010-11

International Business Branded Formulations

Future Growth Drivers
Thrust on brand building in Pain, CVS, CNS, Anti-infective and Antimalarial segments. Geographical expansion in covered countries through additional field force. New geographies South & Central American and West African countries. Expansion in business lines - Institutions and Distributors. Introduction of new products. About 50 existing developed formulations are identified for registration and launch across all continents. The companys wholly owned subsidiary in Mexico has started activities of filing the formulation Dossiers for registration in the said country The company has started marketing its branded formulations in Venezuela, Colombia and Peru in the Latin American Market

International Generic Business

International Business Generics (developed market)

Sales Rs.Mn. Sales USD Mn. CAGR 33%

Country
5359 118 5359 3594 79

Products Registered 44

Products Under Registration 10

United Kingdom / EU Australia / New Zealand South Africa U.S. / Canada

2688 2291 50 59

27

37 14

10 14

2007-08

2008-09

2009-10

2010-11

International Business Generic Formulations

Future Growth Drivers
Dossiers developed by company approved in UK are being taken for MRP registration in other EU countries. Own Dossier filings in Portugal. Most formulations registered to be backed by own API. Sale of Generic Dossiers with or without supply agreements. Contract manufacturing arrangements. Focus on Institutional business especially for Anti-malarials. Approval for Anti-malarial finished dose combination formulation Artemether + Lumefantrine under WHOs Prequalification Programme. Ipca is the 4th Company in the World to have prequalification for this product.

International Business Generic Formulations

Future Growth Drivers North America
Strategic tie up with Ranbaxy Inc. to market around 25 Generic formulations in U.S. In all the company has signed agreements with 3 marketing partners for sale/ distribution of Generic formulations. 23 ANDAs filed of which 12 ANDAs are approved. 12 ANDA filings planned in FY 2011-12 and 10 to 12 ANDAs targetted for filing every year for next 3 years. US Generic business commenced from September, 2008. Many Generic products in pipeline for potential tie ups. Exploring contract development and manufacturing opportunities. Marketing arrangements signed for Canada. Generics export to Canada commenced in FY 2011-12.

International Business Generic Formulations

Future Growth Drivers - United States
Most ANDAs to be backed by own APIs. Formulations manufacturing facility at SEZ Indore commercialized and awaiting US-FDA inspection.

International API Business

API Business - International

Sales Rs.Mn. Sales USD Mn. CAGR 20%
2432
53

3169 70

3335 73

1943
43

2007-08

2008-09

2009-10

2010-11

API - DMFs
Sr. No. Name of the API US FDA UK MHRA Canada HPFB WHO PMDA Japan Australia EDQM

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15

Atenolol Artemether Artesunate Amodiaquine Hcl Amlodipine Besylate Allopurinol Balsalazide Disodium Dihydrate Bendroflumethiazide Bisoprolol Fumarate Carvedilol Cetrizine Dihydrochloride Chloroquine Phosphate Chloroquine Sulphate Chlorthalidone Cilostazole

a a a a a a a a a a a a a a

a a a a a

a a

a a a a a

a a a a

API DMFs (contd..)

Sr. No. Name of the API US FDA UK MHRA Canada HPFB WHO PMDA Japan Australia EDQM

16 17 18 19 20 21 22 23 24 25 26 27 28 29 30

Citalopram HBR Clopidogrel Bisulfate Etodolac Fenofibrate Fluconazole Flumequine Furosemide Glimeperide Hydrochlorothiazide Hydroxyzene Di Hcl Hydroxychloroquine Sulphate Indapamide Isotretinoin Losartan Potassium Lumefantrine

a a a a a a a a a a a a a a a a a a a a a a a a a a a a

a a a a a a a

a a a

API DMFs (contd..)

Sr. No. Name of the API US FDA UK MHRA Canada HPFB WHO PMDA Japan Australia EDQM

31 32 33 34 35 36 37 38 39 40 41 42 43 44 45

Methylphenidate Mesalamine/ Mesalazine Metformin HCL Metoclopramide HCl Metoprolol Succinate Metoprolol Tartrate Nabumetone Ondansetron Hydrochloride Ondansetron Base Paroxetine Hcl Perindopril Probenecid Proguanil Hydrochloride Propranolol HCl Pyrantel Pamoate

a a a a a a a a a a a a a a a

a a

a a a a

a a a a a a a a

a a

a a

a a a

API DMFs (contd..)

Sr. No. Name of the API US FDA UK MHRA Canada HPFB WHO PMDA Japan Australia EDQM

46 47 48 49 50 51 52 53 54 55 56 57 58 59 60 61

Pyrantel Tartrate Pyrimethamine Hcl Quetiapine Fumarate Resperidone Resindronate Sodium Sodium Alendronate Sulfadoxine Torsemide Tramadol Hydrochloride Trimethoprim Triamterene Triclabendazole Valsartan Warfarin Sodium Clathrate Warfarin Sodium Zoledronic Acid Total

a a a a a a a a a a a a a a a
58

a a a a a a a a

a a

a a a
13 16 4 9 9 34

API Business Future Growth Drivers

17 new APIs were commercialized in 2010-11 Aggressively pursuing MNC tie ups for supply agreements. API source change / ANDA approvals of major US customers based on our APIs Atenolol, Furosemide, Propranolol, Hydroxychloroquine Sulphate, Balsalazide, Hydrochlorthiazide to add nearly USD 10 mn. Business in next 2 years. Non-infringing process Patent filed for APIs Losartan, Clopidogrel form 1, Metoprolol Succinate, Valsartan, Glimepride, Carvedilol, Isotretinoin and Perindopril. Targeting 1 DMF filing per month. Own API manufacturing to back formulations, especially for the Generic market. Exploring strategic business relationship with smaller API manufacturers for increasing product basket. Management control of Tonira Pharma Ltd; an export oriented API company with US-FDA approved manufacturing facility acquired in May 2008.

Research & Development (APIs & Formulations)

Research & Development

R & D Spending
Year 2006-07 2007-08 2008-09 2009-10 2010-11 Rs. Mn. 328 429 502 573 713 % to Sales 4% 4% 4% 4% 4%

Research & Development

New Division COVENANCE to undertake Contract Research and Manufacturing Activities (CRAMS) Current scientist manpower of over 350. Research focus on developing APIs with non-infringing process and development of finished dosage forms. Development of NDDS for Domestic and International market. 196 patent applications filed. 75 Patents granted (Indian 58, US PTO - 11, EU- 6)

Research & Development

Future Strategy
Working out strategy to start drug discovery program and to build infrastructure. Bio-tech / fermentation research Laboratory established. The company has subscribed to the capital of a newly incorporated subsidiary company Prayas Bio Lifescience Limited which will be engaged in Research and Development of Biotech/Recombinant DNA Technology products. 2 in licensing arrangements with CSIR labs - NCE 97 / 78 CDRI compound now entering into phase 1 Clinical trial. Pursuing relationship and technical collaboration with CSIR Labs like CDRI, CIMAP & Universities like BITS Pilani. Working for more tie ups with academic institutions. Undertaking contract research activities for APIs & Formulations for International clients.

Thank You
No part of this Corporate Presentation may be re-produced, quoted or circulated without prior approval of Ipca Laboratories Limited. This presentation may include forward looking statements based on our current business expectations. Our actual results may differ from what is projected in this Corporate presentation. The viewers of this presentation may use their own judgements and calculations before making any decision on any matter based on the informations given herein. The Company also disclaims any obligation to revise any of the information given in this presentation.