2020年醫藥行業專題報告：制藥- HDFC證券（英文版）（20頁）.pdf

《2020年醫藥行業專題報告：制藥- HDFC證券（英文版）（20頁）.pdf》由會員分享，可在線閱讀，更多相關《2020年醫藥行業專題報告：制藥- HDFC證券（英文版）（20頁）.pdf（20頁珍藏版）》請在三個皮匠報告上搜索。

1、 28th May, 2020 Thematic Report Pharmaceutical Retail Research P a g e | 1 Retail Research Pharma sector has seen a rerating in terms of stock prices over the last few months led by its defensive character, ebbing of the historical issues faced by it in terms of US FDA diktats, stiff competition in

2、generics pricing in the US, lesser launches in US etc. However the current conditions offer an opportunity for Indian players with efficient cost structures, backward integration and its manufacturing scale. Issues faced by China in terms of quality and the recent move to derisk dependence by the wo

3、rld on China could play to Indias advantage. In the US, we are witnessing an improving outlook for the generic industry with stable QoQ price erosion in the range of the low-to-mid single digits (shortages due to Covid-19 could help stop the price erosion) and may lead to a rise in approvals for Ind

4、ian companies. Indias pharma market has been regularly witnessing 10-11% YoY growth to US$20bn driven by a healthy mix of volume and price-led growth. The industry benefits out of rising penetration of medicines, increasing affordability and a growing incidence of chronic disorders such as diabetes,

5、 cardiac, CNS (Neuro) and oncology. While the long-term outlook is strong, we expect a deceleration in growth for H1 FY21 (April IPM fell by 11% YoY, supply disruptions, with most of the clinics shut leading to lesser new prescriptions, elective surgeries being delayed and hospitals only attending c

6、ritical patients - all these point to a weak H1 F21). The Covid-19 shutdown is likely to have an impact on certain acute therapies (two thirds of the market) due to limited prescription. In addition, chronic ailments (balance one third of the market) like cardiac and diabetes witnessed significant p

7、re-buying in Mar 2020 and hence demand for such drugs could be lower for Q1 FY21. Having said that, we believe that the domestic pharma market can bounce back to 10% growth rate in FY22. There also remains a high possibility that corrective action and preventive measures (CAPA) submitted by India co

8、mpanies are likely to get accepted faster; this may lead to faster approvals. Earnings momentum for Indian pharma companies could continue, due to a gradually improving outlook for the US, strong long-term industry drivers in India market, margin expansion from better product mix and a currency tail

9、wind for exporters. The negative operating leverage of the past (high capex and R and presence in the US generics market. Challenges in the anti- malaria tender and domestic slowdown over the last few years coincided with aggressive capex, led to sharp correction from the peak levels. We foresee goo

10、d prospects with moderating capex and stemming of steep decline in institutional anti- malaria business. Moreover, strong operating leverage led by in-house manufacturing (currently largely outsourced) and strong 16% cagr in US sales to drive 17% earnings cagr over FY20-22E. With increased capacity

11、utilization at Dahej and Guwahati (which are primary for the India market), operating leverage would drive a further improvement in profitability of the DF segment. Ajanta Pharma has diversified branded generics exposure across India, Africa and Asia, thereby reducing the concentration risk in the p

12、ortfolio. We estimate low double-digit growth momentum in the companys branded business to sustain and additional capacities in India to drive operating leverage. Moreover, regulatory risks are limited as two of its US FDA approved plants have recently received EIRs. View the company expects to impr

13、ove further in the next three years. In the Domestic segment, company derives 40% of its revenues from cardiology followed by ophthalmology (23% of revenues). Dermatology and Pain management account for 16% and 6% respectively. With a portfolio of 84 products, Ajanta is ranked No. 3 in the ophthalmo

14、logy market. Top brands are used to mainly treat dry eye and inflammation. Cardiology is one of the fastest growing therapies for the company. Ajantas cardiology portfolio has around 75-80 brands and many of them were first time launches in the market. Key brands in the segment include MET XL, Atorf

15、it CV, Rosufit CV and Cinod. In dermatology, Ajanta is ranked No. 13 and focuses primarily on cosmetic dermatology, which is 100% prescription based and has a market size of Rs 3000cr. Its key brands include Melacare and Aquasoft, both of which have been growing faster than market. In the pain manag

16、ement segment, Ajanta is ranked No. 23 and focuses primarily on specialised pain products like those in ortho. It has 28 brands, with Feburic being the key brand. Domestic Formulations to grow led by Derma, Pain and Cardiac Ajanta expects better growth in Domestic sales to be led by Dermatology, Pai

17、n and Cardiology segments. Covered market growth in Dermatology for the past five years was 14-16%, while company grew at 8% due to a high base of Melacare range of products and higher attrition in MRs. Going forward, covered market growth is expected to grow at 9- 10% and company expects to do bett

18、er (11-12%) as (a) MR team being stabilized for this segment, (b) renewed interest in Melacare range of products and (c) new launches lined up in this segment. Considering covered market growth expectation is at 7-8%, company intends to do better than industry at 10-11% in Cardiology. On a low base,

19、 new launches and better traction in existing products, company is confident to grow at 15% compared to covered market growth of 12% in Pain segment. With a market share of 10% in Ophthalmology, there is limited scope to grow in this category. Company intends to grow in line with industry at 7-8%. H

20、ealthy products pipeline to support strong US growth over FY20-22E To gain competitive advantage in the US, Ajanta is gradually spreading its wings via a select product portfolio, including complex technology products. The company has invested Rs 6.5bn in the US business so far, which currently does

21、 not yield much of returns. It currently markets 27 products in the US, has 26 ANDAs awaiting approval, aims to file 10-12 ANDAs and launch 7-8 products per year. Within the past 5 years, drugs worth US$ 83bn have gone off patent and another US$ 72bn worth of small molecule drugs slated to go off-pa

22、tent in the next 5 years, it is an opportunity for a smaller player like Ajanta. Also, both the Dahej and Paithan (Aurangabad) plants for the US market are US FDA approved and received EIR in August 2019. US generics business is still relatively modest, we estimate 16% cagr in the business over FY20

23、-22E and contribute meaningfully to overall profitability. Africa Business to grow at 9% cagr over the next two years Ajanta Pharma has a meaningful presence in Africa with branded generic business generating Rs 350cr of revenues from 12 countries. It ranks third in Franco-Africa region. Its portfol

24、io comprises of around 130 products. Ajanta has been a strong player in the institutional anti-malaria business for the Artemether Lumefantrine combination over the past five years, being the 1st generic company to receive WHO pre-qualification for this product. In FY20, Africa Institutional busines

25、s grew 24% at Rs 244cr. However, in FY18, 30% reduction in overall allocation by the Global Fund and other tender buyers and Ipcas entry dented Ajantas revenue. However, with the increase in the number of malaria cases, the funding bodies increased their allocations, which started on January 1, 2020

26、. Also in 2018, Ipca re-entered the market after a two years of pause, leading to heightened competitive intensity. RETAIL RESEARCH Retail Research P a g e | 5 Since Ipca is fully backward integrated and is a leader in this segment, it can offer the tender at a more competitive price. In Africa, com

27、pany has 1000 products under registration and it launched 5 new products during FY20. We expect 6% cagr in Inst business and 11% in Africa Branded over FY20-22E. Asia Business account for 26% of the revenues The overall Asia branded business consists of the Philippines, West Asia and Central Asia (C

28、IS). The Philippines is the largest Asian market for Ajanta with Rs 250cr revenues growing at CAGR of 10-12%. Ajanta ranks 17th in the Philippines (US$ 4bn market, growing 3-4% annually) and has 40 products, 15-20 pending for approvals. West Asia (including Iraq, Jordan, Turkey) is Rs 200cr market f

29、or the company. In Asia, company has 350 products registered as on FY20; launched 2 new products during the year. Philippines is the third-largest pharmaceutical market in ASEAN, after Indonesia and Thailand and is estimated to exceed USD 4bn in the coming years. The Philippines disease burden is sh

30、ifting from communicable to non-communicable diseases. Cardiovascular disease is the leading cause of death. Company launched 35 new products in Rest of Asia 2) expansion of R and 3) new building for head office. Company Profile Ajanta Pharma is a specialty pharmaceutical company which develops, man

31、ufactures and markets quality finished dosages. The business includes branded generics in EMs of Asia a few (single digit) are not attractive launches. Management said that company will do 12-15 product filings every year and low double-digit launches. R for FY21/FY22 in a similar range. R managemen

32、t guided for Rs 4-4.5bn for FY20 and Rs 3.5-4bn for FY21. View the company has one of the largest Paracetamol API facilities. The key 5 products contribute 85% of the total revenue. The basket of five key molecules grew 30% in FY19. Over the years, Granules has stepped up its contribution from finis

33、hed dosages from 25% in FY11 to 46% in FY19 and increased further to 51% in 9M FY20, which is a high value and higher margin business segment. US generic business has gained strong traction with 10 launches. Currently, company has 39 ANDAs filed and 19 are awaiting approval from the US FDA Company g

34、uides to file 6-8 ANDAs in FY20. It will launch 6-7 ANDAs from Granules Pharmaceuticals Inc. over the next two years. In FY19, company has set-up its own front-end team to scale-up the US business. We believe launch of own label products will help to improve overall margins. The company has announce

35、d buyback of 1.25cr equity shares at Rs 200 per share totaling to pre Tax outflow of Rs 250cr. The company plans to utilise Rs 200cr which it will receive through divestment of its JV Biocause (China) and Biochem which is expected to close by Q1 FY21. View 17 ANDAs have been filed from the facility

36、till date, significant investment in R going forward management has guided for capitalizing 50% of the total R (a) from time to time, have a long or short position in, and buy or sell the securities of the company(ies) mentioned herein or (b) be engaged in any other transaction involving such securi

37、ties and earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have any other potential conflict of interests with respect to any recommendation and other rel

38、ated information and opinions. HSL, its directors, analysts or employees do not take any responsibility, financial or otherwise, of the losses or the damages sustained due to the investments made or any action taken on basis of this report, including but not restricted to, fluctuation in the prices

39、of shares and bonds, changes in the currency rates, diminution in the NAVs, reduction in the dividend or income, etc. HSL and other group companies, its directors, associates, employees may have various positions in any of the stocks, securities and financial instruments dealt in the report, or may

40、make sell or purchase or other deals in these securities from time to time or may deal in other securities of the companies / organizations described in this report. HSL or its associates might have managed or co-managed public offering of securities for the subject company or might have been mandat

41、ed by the subject company for any other assignment in the past twelve months. HSL or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from t date of this report for services in respect of managing or co-managing

42、public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction in the normal course of business. HSL or its analysts did not receive any compensation or other benefits from the companies mentioned in the r

43、eport or third party in connection with preparation of the research report. Accordingly, neither HSL nor Research Analysts have any material conflict of interest at the time of publication of this report. Compensation of our Research Analysts is not based on any specific merchant banking, investment

44、 banking or brokerage service transactions. HSL may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report. Research entity has not been engaged in market making activity for the subject company. Research analyst has not serv

45、ed as an officer, director or employee of the subject company. We have not received any compensation/benefits from the subject company or third party in connection with the Research Report. HDFC securities Limited, I Think Techno Campus, Building - B, Alpha, Office Floor 8, Near Kanjurmarg Station,

46、Opp. Crompton Greaves, Kanjurmarg (East), Mumbai 400 042 Phone: (022) 3075 3400 Fax: (022) 2496 5066 Compliance Officer: Binkle R. Oza Email: Phone: (022) 3045 3600 HDFC Securities Limited, SEBI Reg. No.: NSE, BSE, MSEI, MCX: INZ000186937; AMFI Reg. No. ARN: 13549; PFRDA Reg. No. POP: 11092018; IRDA Corporate Agent License No.: CA0062; SEBI Research Analyst Reg. No.: INH000002475; SEBI Investment Adviser Reg. No.: INA000011538; CIN - U67120MH2000PLC152193 Mutual Funds Investments are subject to market risk. Please read the offer and scheme related documents carefully before investing.