Stock Idea: Elder Pharmaceuticals Ltd.

Elder Pharmaceuticals Limited—BUY—355—INR
Sector— Pharmaceuticals (Bulk drugs & Formulations)
Regd.off— C-9, Dalia Industrial Estate, Andheri (W.), Mumbai - 400053
Listed— BSE, NSE
Company overview—
Company started its operations in 1989 and established its factory in June. In 1991 company started Research and development center for its pharmaceutical products and got recognition from the Government of India. In 1994, company tied up with Haw Par, Singapore to establish its presence in the market. Company came into stock market in 2000 by public issue. In 2003 company commissioned Patalganga Bulk Drug plant. Company ranked among the first 50 companies in India as per ORG Audit. Company's strength lies in marketing products, which are original research products where there are no patent violations and the company has created its own brand equity in pharmaceutical marketing. Elder, which has it's headquarter in Mumbai, is proficiently supported by branch offices in Chennai, Kolkata and New Delhi. It has sales depots in almost every state in the country. Company’s multi expert sales team hence ensures adequate focus on each of the covered therapeutic segments. The focus is on promotion of products in the wound care segment, antibiotics, gastroenterology, respiratory and painkillers segment. Company is engaged in the manufacture of a wide range of pharmaceutical products through research and development and also in the manufacturing and marketing of diverse products through licensing agreements with international pharmaceutical companies. All the company’s plants conform to and follow the most stringent quality control standards recommended as per GMP guidelines.
Products & services—
Elder Pharmaceuticals principal activities include the manufacturing and marketing of prescription pharmaceutical brands, surgical and medical devices. Shelcal, Elder’s No.1 brand is one of the top brands in the Indian Pharmaceutical industry. It is one of the leading players in the pharmaceutical formulation market in India, being a market leader in three therapeutic segments - Women’s Healthcare, Wound Care and Nutraceuticals. Elder has a strong portfolio of brands like Shelcal, Eldervit and Chymoral among others that are leaders in their respective therapeutic segments and manufactured in various dosage forms like tablets, capsules, injections and liquids. Company has products for Antibiotic, Antihistamines & Antiallergics, Antacid & Antiflatulant, Antiulcers, Antidepressant, Anti inflamatory & Analgesics, Antispasmodics, Antifungal, Laxative, Antihelmentics, Cough syrups, Steriods, Antimalarial, Antidiarrhoeal, Cardiac care, Eye/Ear Care, Hematinics, AntiTB, Nutritional Supplement etc. Company has entered into alliances with foreign companies for manufacture and sale of their products under license from them. It also has a presence in the OTC segment and sells the Tiger range of products from Singapore, SOLO Eucamenth tablets, AMPM mouthwash and toothbrushes. The company has diversified into sale of medical equipments. Export markets include Switzerland, Germany, England, Denmark and a few African countries. Company exports its pharma products to Colombia, Vietnam, Madagascar, Mauritius, Nigeria, Uganda, Sri Lanka & Mexico.
Company has alliances and marketing rights with ABC Ltd, USA Oxo-Chemie, Germany Paul Hartmann, Germany, Angelini, Italy GEA Ltd, Denmark TRB Chem., Switzerland Alfa-Wasserman, Italy, Sigma-Tau, Italy Tanabe, Japan Fujisawa, Japan Uriach, Spain, Covex, Spain Ferrer, Spain, Blistex, USA Haw Par, Singapore, Invacare, USA, APR, Switzerland Zambon, Italy Biorga, France Stiefel, USA Sciclone, USA Poli, Switzerland etc. for various products.
Valuation—
Company has strong position in National and International Health Care arena, with focus on research and global collaborations. At current market price, stock is trading at 8.75 P/E multiple of its FY2011 estimated EPS. We recommend investors to "BUY" "Elder Pharmaceuticals Limited" with medium to long-term investment horizon.
Source: Internet (Valuenotes by Abhishek Jain)

Stock Idea: Glenmark Pharmaceuticals Ltd.

Glenmark Pharmaceuticals Ltd— BUY—255—INR
Sector — Pharmaceuticals (Bulk drugs & Formulations)
Regd.Off.— 22, Bhulabhai Desai Road, Mumbai, 400026
Listed — NSE, BSE.
Company Overview—
Glenmark Pharmaceuticals Limited was incorporated in the year 1977. Glenmark is an India-based one of the fastest growing pharmaceutical company headquartered at Mumbai. Glenmark has built a visible and growing branded generic formulation presence across all its markets in Asia, Africa and CIS countries. A number of its products have emerged as brand leaders in India and these markets. Company is focused on the manufacture and marketing of formulation products and active pharmaceutical ingredients in India as well as globally and enjoys a diversified and growing presence in regulated and developing international markets. Over the past five years, the Company has also catalyzed its growth through investment in dedicated research and development including cutting-edge New Chemical Entity research. Company operates in over 75 markets for formulations and also supplies Active pharmaceutical ingredients to over 50 markets worldwide. Glenmark has strengthened its integration across the pharmaceutical value chain through operations across its various manufacturing plants, i.e. for formulations at Baddi, Goa, Nasik and Sao Paolo (Brazil) for API in Ankleshwar, Kurkumbh and Solapur. The Ankleshwar plant acquired from GlaxoSmithKline has received US FDA acceptance while the API manufacturing facilities at Kurkumbh and Solapur focus on supplying intermediates and APIs to less regulated markets. Company also acquired an ANVISA approved formulations facility in Brazil.
Products & Services—
Glenmark Pharmaceuticals Limited focuses on manufacturing and marketing formulation products within India. Glenmark made a foray into the bulk drug business in 2001. Today, it has generic formulation and API business interests in over 65 countries across the world including the highly regulated markets of USA and Europe. The formulation business spans several product segments such as Dermatology, Internal Medicine, Pediatrics, Gynecology, ENT and Diabetes. Company's business segment portfolio broadly comprises of both formulation and bulk drug sales. Company follows a branded generic model in markets across Asia, Africa, CIS/Russia and Latin America. In contrast, in the highly regulated markets of USA and Europe, the company has adopted a business model of registering and marketing generic drugs. The Bulk Drugs or API business for Glenmark handles the sales and marketing of active pharmaceutical ingredients to customers in many markets across the globe and also serves some of the captive needs of the formulations business within the company.
Formulations: Glenmark's formulation business has invested in building a manufacturing footprint to cater to the demand. The current footprint includes - One WHO-GMP plant at Nasik to cater to semi-regulated markets including India. The plant handles several dosage forms including liquids, solids, semi-solids and dry powders. A plant at Goa built to USFDA and EU standards. The plant has capabilities to manufacture tablets, capsules and ointments/creams. Another one ANVISA approved manufacturing plant in Brazil to cater to Latin American markets. This plant has capabilities in solids, liquids and semi-solids. In India, the company markets about 100 molecules/combinations spanning a diverse set of therapy segments. Over 50 of these molecules/combinations are also being marketed across the semi-regulated markets of Asia, Africa, Russia/CIS countries; more products are under registration in these markets. In formulations, Company is focusing working on Anti-diabetics, Respiratory Tract Infections, Cardiovascular, Pain & Anti-Inflammation, Dermatology, Gynecology, Internal medicine, and Pediatrics etc.
Active Pharmaceuticals ingredients— Active pharmaceutical ingredients (API), which are used as raw material in the manufacture of formulations, are the building blocks in the pharmaceutical industry. Company’s R&D center in Navi Mumbai employs over 350 scientists who have a vast experience across several disciplines and technology platforms. The research activities encompass process engineering for APIs, new chemical entity research and novel drug delivery systems. Company also operates a second research facility at Sinnar, near Nasik in India that focuses on developing formulations for India and markets across Asia, Africa, Latin America and CIS/Russia. Glenmark is amongst the few Indian Pharmaceutical Companies to have taken initiative to invest proactively in original drug discovery research.
Recent News—
On 22 jan, Glenmark Generics, USA, a subsidiary of Glenmark Pharmaceutical has received tentative approval by the United States Food and Drug Administration (USFDA) for Trandolapril and Verapamil hydrochloride extended-release tablets, its generic version of Abbott’s Tarka® tablets. Glenmark’s current marketing portfolio consists of 49 products authorized for distribution in the United States and it has nearly 50 ANDAs in various stages of the approval process with the USFDA.
On 2 mar, Glenmark Generics, (GGI) USA, a subsidiary of Glenmark Generics (GGL), has received ANDA approval from the United States Food and Drug Administration (USFDA) for Ropinirole Hydrochloride tablets 0.25 mg, 0.5 mg, 1 mg, 2 mg, 3 mg, 4 mg and 5 mg. Ropinirole Hydrochloride tablet is the generic version of GSK’s Requip® tablet in the US market. Total sales for Ropinirole Hydrochloride tablets in the twelve month period ending December 2009 were USD 104 million, as reported by IMS Health.
Valuation—
At current market price, stock is trading at 11.74 P/E multiple of its FY2011 Estimated earnings. We recommend investors to buy "Glenmark Pharmaceuticals limited" for medium term investment horizon.
Source: Internet (Valuenotes by Abhishek Jain)