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Top Pharmaceutical Companies in India taking on the World despite inbound M&A

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The growth in Pharmaceutical companies has been tremendous in India. It is the second largest growing sector in country dominating the $8 billion domestic pharma market which is growing at around 15-16% pa. The Indian pharmaceutical industry is the third largest in the world which is estimated to have a value of $750 billion growing at 6.5% per year.Mergers and acquisitions have become an increasingly important feature of this industry with foreign pharma giants like Merck,Pfizer,Daiichi looking to buy these fast growing small Indian companies.The recent buyouts of Piramal by Abbott and Ranbaxy by Daiichi reflects the desire of Pharma MNCs to inorganically grow their generics strength.This has raised some concerns amongst the Indian government about the independence of the Pharma Industry.However pharma companies are proliferating taking advantage of India’s low cost technical workforce to grow at breakneck speed.. A broad overview of the pharma companies based on the revenue generated in 2007 & market cap is given below:

    1. Ranbaxy Laboratories-Ranbaxy is the leader in the Indian pharmaceutical market. It was the first Indian pharmaceutical to have a proprietary drug approved by the U.S. FDA, and the U.S. market accounts for 36% of its sales. 78% of Ranbaxy’s sales are from overseas markets. Ranbaxy is among the top 100 pharmaceuticals in the world and that it is the 15th fastest growing company. By 2012, the company hopes to be one of the top 5 generics producers in the world. By sales India’s largest pharma firm with the returns touching Rs 4,198.96 crore & a market cap of Rs.24,026.69 crore.The Company has now become a subsidiary of the Japanese Pharma Giant Daiichi.
    2. Dr. Reddy’s Laboratories-Dr. Reddy’s was the first Asia-Pacific pharmaceutical outside of Japan and the sixth Indian company to be listed on the New York Stock Exchange.With a turnover of Rs 4,162.25 crore , Dr Reddy’s lab is second largest. Market cap of Rs.29,773.96 crore.
    3. Cipla-Cipla burst into the international consciousness in 2000 with Triomune, an AIDS treatment costing between $300 and $800 per year.The company generated an annual revenue of Rs 3,763.72 crore making itself the third largest pharmaceutical firms with a market capitalisation of Rs.27,945.68 crore.
    4. Sun Pharmaceuticals-Sun Pharma Industries had an overall earnings of Rs 2,463.59 crore & a market capitalisation of Rs. 46,182.39 crore.Sun Pharma has become the biggest company in India by market capitalization.
    5. Lupin LabsLupin Labs yielded total profit of Rs 2,215.52 crore.The market cap is Rs.21,785.24 crore.
    6. Aurobindo Pharma-India’s sixth largest pharma company by sales, Aurobindo posted Rs 2,080.19 crore annual returns & market capitalisation of Rs.7,186.87 crore.
    7. GlaxoSmithKline-With market capitalisation of Rs.19,123.82 crore & turnover touching Rs 1,773.41 crore, GSK is India’s seventh largest pharma firm.
    8. Cadila Healthcare-Cadila’s earnings was Rs 1,613.00 crore establishing itself as India’s eight largest drug company. Rs.15,957.08 crore is the market capitalisation of the company.
    9. Aventis PharmaWith an annual revenue of Rs 983.80 crore , Aventis Pharma has made a place for itself in the top ten pharma companies in India.
    10. Ipca Laboratories-Ipca is India’s 10th largest pharma company by sales  with turnover of Rs 980.44 crore & market cap of Rs.4,181.46 crore.

      Abhishek Shah

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