Cipla keeps the steady momentum of growth with an overall growth of more than 57% in income from operations for the quarter ended March 2006. Currently,

we are one of the largest exporters of pharmaceutical products in India, exporting APIs and formulation products to more than 180 countries including the U.S., and a number of countries in Europe, Africa, Australia, Latin America and the Middle East.

Both the international as well as the domestic business have recorded a growth of more than 56% and 63% respectively, in the last quarter. All the major segments including anti-asthmatics, cardiovascular and anti-biotics/bacterials segments have shown good performance in the domestic market.

RIn the exports markets, anti-retrovirals, anti-malarials, anti-asthmatics, anti-depressants and cardiovascular segments have performed well.

In April 2006, Cipla raised US$ 170 million (Rs. 762.20 crores) through an issue of 1,10,46,310 Global Depository Receipts (GDRs). Each GDR represents one equity share of Rs.2 each and was priced at US$ 15.39 (equivalent to Rs.690). The said GDRs have been listed on the Luxembourg Stock Exchange and the Company has already applied to Bombay Stock Exchange Limited (BSE) and National Stock Exchange of India Limited (NSE) for having the underlying shares listed.

The Board of Directors recommended the issue of bonus shares in the ratio of three shares for every two shares held and the shareholders have approved the same through a postal ballot on 21st March, 2006.The record date for determining the members who are entitled to the bonus shares is 25th April, 2006.

Consequent to the issue of GDRs and bonus shares, the paid-up equity share capital will stand increased to Rs. 155.46 crores.

Cipla has created strong reserve position and its reserves touched to Rs 1493.66 crore during the year ended March 2005. It has reduced its investments in the mutual funds drastically during 2004-05 which declined to Rs 18.30 crore from Rs 180.37 crore to part finance its ongoing expansion programmes.

As Cipla turns 70, the company is set to achieve further improvement with commissioning of its expansion projects and launching of new products. It has 140 ongoing projects with five companies in the US. It has a strategic alliance with the US generics major Watson, IVAX, Eon etc. Its alliance partners have filed 31 ANDAs and it is expected that they will filled additional 35 ANDAs in the next 12-15 monthsCipal : Active in overseas markets.

Shobhana Subramanian & Varun Sharma
Stronger exports have helped boost revenues.
Driven by a smart 50 percent growth in exports, the Rs 4,227 crore Cipla posted a top line growth of nearly 34 percent in the June 2008 quarter. The relatively low base of Q1FY08 and a weaker rupee not with standing, this is the fourth quarter of successive good growth recorded by the drug major.
Revenues from the home market in June too have grown at a reasonably good 16 percent and consequently the operating profit margin expanded 360 basis to 22 percent, after adjusting for a forex loss of Rs 75 crore. The forex loss, however, depressed the net profit which rose just 17 percent to Rs 140 crore.
Exports accounted for about half the firm’s revenues of Rs 1207 crore last quarter. Analysts believe the higher sales of active pharmaceutical ingredients (API) could have included supplies to Teva , for a product sold exclusively in the US for a period of 180 days.
However, since such orders for supplies during periods of exclusivity do not recur too often , it will be sales of formulations that will determine the place of Cipla’s exports in subsequent quarters.
To sustain a 25-30 percent growth in exports, however , the company will need to increase the proportion of high value products, like inhalers , to regulated markets. Cipla, which has launched asthma inhalers in Germany , Spain and Portugal, is looking to gain a foothold in the CFC- free inhaler market.
Cipla has one of the strongest pipelines of generics among Indian companies.
The company has pursued a strategy of teaming up with players overseas but does not get involved in patent litigation. It has recently roped in a couple of partners in the US and EU and plans to supply over 100 products to overseas markets in the next few years.
The management believes the company’s revenues can grow at 12-15 percent in FY09 and net profits at around 11-13 percent.