A Financial Study on CIPLA

Pharmaceuticals Ltd.
BY PGDM-EBIZ :
1)Tanuj Gandhi-33
2)Santosh Kadge- 36
3)Nitish Kakkar- 37
4)Rajvee Shah -42
5)Bushra Vahora -43

Pharmaceuticals Industry
By 2020, India is likely to be among the top three
pharmaceutical markets by incremental growth
and sixth largest market globally in absolute size
Indias cost of production is significantly lower
than that of the US and almost half of that of
Europe.

Cipla Ltd
Incorporated
Chairman
Non-Executive Vice-Chairman

1935
Dr. YusufK. Hamied
Mr. M.K. Hamied

Listing

Equity Shares: BSE Limited and National Stock

Exchange of India Limited
Global Depository Receipts: Luxembourg Stock
Exchange
USD 1.78billion
20,000+
US FDA, WHO-Geneva, MHRA-UK, TGA-Australia, SUKLSlovak Republic, APVMA-Australia, MCC-South Africa,
PIC-Germany, Danish Medical Agency, ANVISA-Brazil,
INVIMA- Colombia, NDA-Uganda, Department of HealthCanada and MOH-Saudi Arabia, among others

Turnover*
Employees*
Approvals

Highlights

Continuous innovation in R &D with 30+world firsts.

Over 1,500 products across varioustherapeutic
categories, with 60+dosage forms.
Presence in over 150 countries

Domestic & International Market

The company's turnover doubled in the last five years to Rs 11,000 crore
in 2014-15.
The net profit marginally declined due to statutory price reductions of a
number of drug formulations in the domestic market and major diverse
long-term investments to build its portfolio and pipeline of newer
products.
The company looks to introduce new products and devices in India, US
and European markets.
Our US business will also increase to 20 percent from the present 8
percent.

Revenue from Different

Regions
Country

Revenue(%)

India

42

South Africa

14

Europe

North America

Others

32

Competitive Analysis
INRin
Crores
Market Capital of Listed Pharma Companies
July 2015
250,000

200,000

150,000

100,000

50,000

Important Financial Ratios

Current Ratio =1.83

ROE=10.65

 Operating Profit Margin

=15.06

Interest Coverage Ratio

=11.32

Growth Drivers

Economic impact
Q1 2015-16
Cipla Revenue : Rs 3853 Crores
Domestic : Rs 1397 Crores
Outside India : 2380 Crores (61 % of Total Revenue)
Rupee Depreciation against Dollar-Increase in Cash Inflows
Cipla Supply Model ,Costing in Local Currency;Sales in Forex
Natural Hedging against Rupee Depreciation
Conservative Hedging By Forward Contracts.

Risk Management - Hedging

Value In Crores
Hedging
instrument

Currenc Cross
y
Currency

2015

2014

Forward ContractSold

USD

INR

799.43

1261.14

ZAR

INR

225.99

USD

INR

535.78

826.83

Unhedged Receivable

898.97

327.92

Unhedged Payables

575.59

457.91

Unhedged - Short
Term Borrowings

843.75

Forward Contracts
- Bought

Conclusion
As U.S Go-Live is on track Cipla should aim to
double the revenue from the US market to 20% by
2020.
Cipla's expansion into the US and Europe will be
mainly supported by its plans over inhaler products
such as Advair and Symbicort, the two largest
selling drugs in the world. It should also look upon
to expand the respiratory and injectable portfolio
Cipla should consider options like joint ventures
and acquisitions for expanding the front-end
operations.