KOPRAN LTD - INVESTOR PRESENTATION - DT 6th, NOV,2020

 

KOPRAN

INVESTOR PRESENTATION

DT 6th, NOV,2020

 

What Kopran is :

·       An integrated pharmaceutical Company, committed to supply International Quality Formulations and Active Pharmaceutical Ingredients (APIs) across the world

·       Its manufacturing facilities and product range have received various accreditations from across the globe

·       State-of-the-art manufacturing facilities approved by major global regulatory authorities

·       Formulations vertical is operated through Kopran Limited

·       APIs vertical is being operated under Kopran Research Laboratories Ltd. (KRLL), a wholly-owned subsidiary of Kopran Limited

MANAGEMENT

SURENDRA SOMANI           Exec. Vice Chairman

Adarsh Rajendra Somani    Director

Susheel Somani                 Director

 

* These are the two major verticals in the pharmaceutical value chain :API and FORMULATIONS

API BUSINESS REVIEW

PLANT is at Mahad, MH

Products are :

Atenolol

Pregabalin

Cephalosporins-Non-Sterile & Sterile

Macrolides

Granules

Sterile Carbapenems

·       Multipurpose plants

·       Pilot plant

Located at MIDC Mahad, Maharashtra

11,900 sq. mts.built up area

162 KL Capacity

·       Development, manufacturing and sale of diverse Active Pharmaceutical Ingredients (APIs) and Advanced Intermediates

·       One of the leaders in Atenolol

·       One of the major players in Sterile Carbapenems

·       Excellent facility and quality systems Catering to export & domestic market

The plant has been approved by US FDA *EU GMP       *WHO GMP,       COFEPRIS & KFDA*

For US & OTHER REGULATED MARKETS :

Focus Areas

·       Constantly working on process and yield improvements of existing products to make them more competitive.

·       US FDA 5 filed; 1 approval received during the quarter;

·       EU CEP : 1 approval received during the quarter; 4 filed totally.

·       China SFDA 2 filed; 1 approval received during the quarter;

ATENOLOL : HYPEERTENSIVE DRUG :

·       Expect to gain a major market share of the US market in next two years

·       Received approval from US FDA, European FDA and Chinese SFDA

·       Create a strong pipeline of blockbuster products targeted for Regulated markets

·       Increasing the product portfolio of Anti-Diabetic and Anti-thrombosis drugs

·       Developing the entire range of carbapenems

2 products commercialised in H1

4 products validation batches taken in H1

8 products R&D completed

EMPHASIS ON EXPORTS

·       Explore, develop and commercialise products for exports market to leverage expertise and manufacturing capabilities

·       Focusing on increasing its share in remunerative export market

·       Actively engaged with large companies to secure  long-term arrangement

WAY FORWARD :

DEVELOP NICHE AND BLOCKBUSTER PRODUCTS :

·       Developing complete range of Carbapenems to solidify the Company’s position in the segment

·       Developing Anti-thrombosis and Anti-diabetic portfolio

IMPROVING FACILITY AND ENHANCE CAPACITY

·       Undertaking upgradation and expansion of  3 blocks at its Mahad facility in Q4 to cater to the increasing demand of existing products and manufacture new molecules that are being developed

·       Developing its Panoli site as an  Intermediate facility, which is expected to be operational by Q2/Q3 FY 2021-22.

PENETRATE DEEPER IN REGULATED MARKETS :

·       Plans to file DMFs for all its new molecules in regulated markets, thereby gaining a significant share in the market.

US MARKET -ASTENOLOL DRUG

·       Received US FDA approval for its Anti-hypertensive Drug Atenolol

·       Plans to capture major share of the US Atenolol market in the next two years

·       To achieve this feat, the Company is actively engaged with major players in the US for supply agreements for 4 products for which DMFs have been filed with USFDA

·       Plans to file DMFs for all new products being developed

 

FORMULATIONS BUSINESS OVERVIEW :

Dedicated Facilities :

Penicillin-based Finished Dosage Forms

Non-Penicillin-based Finished Dosage Forms

Plant Located at Khopoli, Maharashtra11,432 sq. mts.of  built-up area

Formulations Vertical

·       Development and manufacturing of oral solid dosages and dry powder formulations for both Penicillin and non-Penicillin-based drugs

·       Catering 100% export markets of both Regulated and non-Regulated markets

·       Manufacturers of more than 100 dosages meeting the standards of international markets which includes Tablets, Capsules, Dry Powder and Suspension

PRODUCT SEGMENTS :

PENCILLIN BASED FDFs

Anti-infective

Anti-diabetic

CNS

Pain Management

Gastroenterology

NON PENCILLIN BASED FDFs

Macrolides

Anti-hypertensive

Cardiovascular

Anti-helmentics

Anti-histamine

EDS

ACCREDITATIONS :

Approved by 11 countries including TGA Australia, MCC South Africa, MHRA UK, FMHACA Ethiopia, PPB Kenya, MOH Oman, MOH Yemen, NDA Uganda, MOH Ivory Coast

GMP Certification by FDA, Government of Maharashtra

WHO GMP Certification by CDSCO, Government of India

CAPACITY :PENCILLIN BASED FDFs

1,747 million Capsules

31 million bottles of Dry Syrup

1,553 million Tablets

NON PENCILLING BASED FDFs

2,000 million Tablets (Uncoated)

1,000 million Tablets (Coated)

947 million Capsules

FORMULATIONS PROCESS IMPROVEMENTS ETC

Constantly working on process / technology and yield improvement measures to make its existing products competitive and increase profitability

EMPHASIS ON REGULATED MARKETS :

Develop products/formulations that match references/innovators products for the Regulated markets

Canada and the UK

o Market largely dominated by contract manufacturing business

o 5 dossiers filed in H1 of 2020-21

FOR NON REGULATED MARKET

Develop products/formulations and file Dossiers in non-regulated markets to gain a significant market share

Filed 101 dossiers in H1 of 2020-21

GROWING INTO NEW MARKETS :

French West Africa, South-East Asia and few Latin American markets are the focus countries for expanding its presence and Company is at the forefront of formulation business

88 dossiers filed in Africa & French West Africa region

72 dossiers filed in South East Asia region

46 dossiers filed in Latin America region

TENDER MARKETS :

Actively participate in all  tenders in African region for products in which company is present

OPERATIONAL HIGHLIGHTS :

South Africa increased from 34% to 50%

Africa reduced from 52 % to 30%

Pencillin products came down from 61% to 47%

Non pencillin products went up from 39% up to 53%

WAY FORWARD :

Automation of Manufacturing and Packaging line which would increase output of finished products, efficiency across production chain and reduce variable and manpower cost

Development of Products and Dossiers :

Regulated Markets :

5 dossier filed in past two quarters 

3 dossiers planned for filing by end of Q4 2020-21

Non Regulated Markets :

101 dossiers filed in past two quarters

100+ dossiers planned for filing by end of Q4 2020-21

TO ACTIVELY PARTICIPATE IN ALL AFRICA TENDERS

ADD MORE PRODUCTS TO PORTFOLIO

Execute large tenders won in SADC Region, Tanzania, Ethiopia

FINANCIAL PERFORMANCE

EBITDA MARGIN has increased from 13% in Q2 fy18 to 20% in Q1 FY 20 h1 2020-21

ROCE : has increased from 15% in 2017-18 to 33% in H1 2020-21

RONW/EQUITY has increased from 15% to 30%

Total Deby/Equity has come down from 0.57 in Q2 FY 2017-18 to 0.29% in Q1 /H1 2020-21

Promoters hold 43.78% of shareholding

QUARTERLY RESULTS ANALYSIS

Quarterly	Sep-20	Jun-20	Mar-20	Dec-19	Sep-19	YOY
Total Income	124.54	124.4	87.56	101.59	89.22	39.59
Total Income Growth (%)	0.11	42.08	-13.81	13.86	3
Total Expenses	100.41	103.3	78.87	90.43	79.6	26.14
Total Expenses Growth (%)	-2.81	30.98	-12.78	13.6	0.91
EBIT	24.14	21.1	8.69	11.15	9.62	150.94
EBIT Growth (%)	14.41	142.9	-22.14	15.99	24.28
PAT	16.63	14.23	4.81	6.31	5.67	193.3
PAT Growth (%)	16.86	195.87	-23.82	11.26	34.42
EBIT Margin (%)	19.38	16.96	9.92	10.98	10.78	79.78
Net Profit Margin (%)	13.35	11.44	5.49	6.22	6.36	109.91
Basic EPS (₹)	3.84	3.29	1.11	1.46	1.31	193.13

 

Annual results analysis

Annual Results	FY 2020	FY 2019	FY 2018	FY 2017	FY 2016
Total Revenue	360.13	360.96	322.92	320.49	298.69
Total Revenue Growth (%)	-0.23	11.78	0.76	7.3	-10.11
Total Expenses	331.29	329.3	300.03	295.73	286.77
Total Expenses Growth (%)	0.61	9.75	1.45	3.12	-9.51
Profit after Tax (PAT)	21.02	24.02	20.49	19.91	10.72
PAT Growth (%)	-12.5	17.26	2.89	85.77	-
Operating Profit Margin (%)	10.5	11.35	10.04	12.41	8.25
Net Profit Margin (%)	5.84	6.71	6.53	6.42	3.61
Basic EPS (₹)	4.86	5.55	4.74	4.6	2.59

 

Insights

 

    Stock Returns vs Nifty Smallcap 100

    Stock gave a 3 year return of 116.51% as compared to Nifty Smallcap 100 which gave a return of -19.4%. (as of last trading session)

 

    Stock Returns vs Nifty Pharma

    Stock generated 116.51% return as compared to Nifty Pharma which gave investors 36.62% return over 3 year time period. (as of last trading session)