Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Pharmaceuticals - India
September sustains growth
momentum
„Domestic formulations register 15%+ growth in Sep-11
Post recovery in August, domestic formulations sustained growth momentum, with
15.1% growth in Sep’11, per AIOCD-AWACS data (secondary sales). However, the
key trends remain similar to the previous month, with MNCs continuing to show
strong growth. Sun, Lupin and Glenmark continued to outpace industry growth, led
by a higher focus on chronic segments. We maintain our positive view of the
domestic market and expect it to grow at a 13-15% CAGR over the medium term.
Sun, Lupin and Glenmark sustain industry outperformance
Among domestic names, Sun (up 25%), Lupin (up 19%) Glenmark (up 18%) and
Macleods (up 41%) were the key outperformers in the top 20 names in Sep’11, in
line with recent past. The impact of product launches from Merck JV (Sun) and
new therapy launches (Ophthalmology, OC – Lupin) has also contributed to sales
momentum. Focus on chronic therapies (47-78% of portfolio) and strong brand
recall in key segments would benefit Sun, Lupin and Glenmark most, with a high
proportion of sales from domestic business (28-42% of sales).
MNC companies up the ante
MNC companies (10 in top 50) grew at an average 18% YoY in Sep’11, sustaining
the strong growth exhibited so far (up 17% MAT Sep’11). Increased intensity of
patented launches and focus on field-force expansion have been the key enablers.
Pfizer, Sanofi and MSD were leaders in growth (sales up 22-28%). We believe that
the increased growth trajectory in the last 2-3 quarters should reflect in primary
sales as well in coming quarters. MNC companies have 20% market share,
outpacing Indian companies’ growth by 250bps so far (YTD Sep-11).
Bonus offers help push up sales for emerging companies
While bonus unit offers have helped emerging companies like Mankind, Aristo and
Macleods to grow rapidly at 30-50%, the pace of growth has slowed of late. This
is possibly due to eventual take-off of sales driven by prescriptions. However, this
practice so far has been concentrated in the acute segments like anti-infectives
and respiratory segments, hence, putting pressure on incumbents with exposure
to acute segments in the near term.
Pressure in acute areas to affect IPCA, Cadila, Dr Reddys
Apart from bonus offers, higher field-force intensity by new entrants has led to
intense competition in the acute therapy segments. As such, even companies with
established brands are getting affected. Moreover, seasonal variation (weak antimalarials) could also affect companies like IPCA in 2Q performance. We also
expect weaker sales performance in near term for Cadila, Dr Reddys and
Ranbaxy (compared to industry) due to higher exposure to acute segments.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Pharmaceuticals - India
September sustains growth
momentum
„Domestic formulations register 15%+ growth in Sep-11
Post recovery in August, domestic formulations sustained growth momentum, with
15.1% growth in Sep’11, per AIOCD-AWACS data (secondary sales). However, the
key trends remain similar to the previous month, with MNCs continuing to show
strong growth. Sun, Lupin and Glenmark continued to outpace industry growth, led
by a higher focus on chronic segments. We maintain our positive view of the
domestic market and expect it to grow at a 13-15% CAGR over the medium term.
Sun, Lupin and Glenmark sustain industry outperformance
Among domestic names, Sun (up 25%), Lupin (up 19%) Glenmark (up 18%) and
Macleods (up 41%) were the key outperformers in the top 20 names in Sep’11, in
line with recent past. The impact of product launches from Merck JV (Sun) and
new therapy launches (Ophthalmology, OC – Lupin) has also contributed to sales
momentum. Focus on chronic therapies (47-78% of portfolio) and strong brand
recall in key segments would benefit Sun, Lupin and Glenmark most, with a high
proportion of sales from domestic business (28-42% of sales).
MNC companies up the ante
MNC companies (10 in top 50) grew at an average 18% YoY in Sep’11, sustaining
the strong growth exhibited so far (up 17% MAT Sep’11). Increased intensity of
patented launches and focus on field-force expansion have been the key enablers.
Pfizer, Sanofi and MSD were leaders in growth (sales up 22-28%). We believe that
the increased growth trajectory in the last 2-3 quarters should reflect in primary
sales as well in coming quarters. MNC companies have 20% market share,
outpacing Indian companies’ growth by 250bps so far (YTD Sep-11).
Bonus offers help push up sales for emerging companies
While bonus unit offers have helped emerging companies like Mankind, Aristo and
Macleods to grow rapidly at 30-50%, the pace of growth has slowed of late. This
is possibly due to eventual take-off of sales driven by prescriptions. However, this
practice so far has been concentrated in the acute segments like anti-infectives
and respiratory segments, hence, putting pressure on incumbents with exposure
to acute segments in the near term.
Pressure in acute areas to affect IPCA, Cadila, Dr Reddys
Apart from bonus offers, higher field-force intensity by new entrants has led to
intense competition in the acute therapy segments. As such, even companies with
established brands are getting affected. Moreover, seasonal variation (weak antimalarials) could also affect companies like IPCA in 2Q performance. We also
expect weaker sales performance in near term for Cadila, Dr Reddys and
Ranbaxy (compared to industry) due to higher exposure to acute segments.
No comments:
Post a Comment