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Financial Analysis of Novartis

Financial Analysis of Novartis

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    Novartis Novartis Presentation Transcript

    • FINANCIAL ANALYSIS OF
      • PRESENTED BY:
      • NAMES ROLL.NOS
      • HARISH ANAND 93
      • VINIT GOGARI
      • SUNIL GUPTA 57
      • SULBHA SEHLAR 17
      • SHYAM LAL
    • PHARMACEUTICAL INDUSTRY IN INDIA
      • Size Of The Industry : US $5 bn
      • Ranked 4 th In Terms Of Volume & 13 th In Terms
      • of Value.
      • 8% Of Global Market In Volume Terms & Over
      • 1% In Value Terms.
      • Annual Growth Rate of 14.3%
      • Expected To Grow To U.S $25 bn By the Year
      • 2010.
      • There Are Roughly 23000 Pharma Companies.
      • Only around 300 pharma companies are in
      • the organized sector.
      PHARMACEUTICAL INDUSTRY IN INDIA (contd.)
    • PHARMACEUTICAL INDUSTRY IN INDIA (Contd..) e.g. PARACETAMOL e.g. Vicks Syrup e.g. GLUCOSE (CROCIN) Paracetamol SALINE Dextromethorphan
    • SWOT ANALYSIS
      • THREATS
      • Low cost countries like
      • China & Israel.
      • OPPORTUNITIES
      • Huge market for
      • Lifestyle drugs.
      • M igration into a
      • product patent based
      • regime .
      • Indian pharma market
      • is one of the least
      • penetrated.
      • WEAKNESSES
      • Lower profitability due
      • to price regulations.
      • Highly fragmented
      • market.
      • STRENGTHS
      • Low cost producer of
      • drugs.
      • Growth of middle class
      • in the country.
      • P opulation of over a
      • billion .
    • RESEARCH & DEVELOPMENT
      • Focus of companies on R&D has increased with
      • the advent of product patents.
      • Increase in R&D spending from US $ 2.3 million
      • in 1977 to US $ 80 million in 2001.
      • Major domestic players in R&D activities are
      • Ranbaxy, DR.Reddy’s, Novartis, Cipla, Nicholas Piramal and Wockhardt.
    • NOVARTIS HISTORY
      • 1996 – The shareholders of Sandoz & Ciba-Geigy
      • approve merger.
      • 1997 – Novartis announces to acquire crop
      • protection business of Merk & co.
      • 2000 – Novartis seeds is merged with
      • Astrazeneca’s agribusiness operations to
      • form Syngenta.
      • 2001 – FDA grants clearance for Glivec.
      • 2003 – Novartis unites its generics business
      • under one single global brand- Sandoz.
    • COMPANY PROFILE – NOVARTIS INDIA
      • Novartis India – 51% subsidiary of Swiss giant
      • Novartis.
      • Established in the year 1996 by merging Hindustan
      • Ciba- Geigy and Sandoz (India).
      • Business: Pharmaceuticals, OTC,Generics &
      • Animal Health.
      • Manufacturing accounts for only 5% of turnover.
      • Trading activity helps Novartis reduce its
      • overheads.
      • Therapeutic Segments- Gynaecology, CNS,Anti-
      • infectives,CVS,Anti-Diabetes and Pain & Inflammation.
    • NOVARTIS INDIA- EXECUTIVE COMMITTEE
    • SHAREHOLDING PATTERN OF NOVARTIS INDIA
    • MARKET SHARE OF MNC PHARMA COMPANIES IN INDIA 1.8% NOVARTIS 5 2.2% AVENTIS 4 2.2% ABBOTT 3 3.0% PFIZER 2 5.6% GLAXO 1 MARKET SHARE COMPANIES RANK
    • NOVARTIS – PHARMACEUTICALS BUSINESS
      • Pharmaceuticals business at Novartis India contributes around 62% of Sales.
    • SALES OF NOVARTIS INDIA IN 2006-2007.
    • GROWTH COMPARISON FOR NOVARTIS (0.58%) 6.06% 3.71% Total Expenses 6.08% 3.29% 9.74% Total Income 19.06% 16.31% 40.45% Other Income 5.20% 2.28% 7.05% Sales 2004-2005 2005-2006 2006-2007
    • EXPENSES AS % OF SALES FOR NOVARTIS 0.70% 0.19% 0.18% Interest 1.86% 2.46% 2.61% Depreciation 4.68% 2.20% 5.65% Material Cost 45.23% 50.37% 46.20% Purchase of Traded Goods 2004-2005 2005-2006 2006-2007
    • GRAPH SHOWING PAT FOR 4 YEARS
    • WORKING CAPITAL RATIOS CURRENT RATIO v/s QUICK RATIO
    • TURNOVER RATIOS
    • TURNOVER RATIOS (contd…)
    • TURNOVER RATIOS (contd…)
    • GROSS PROFIT MARGIN
    • LEVERAGE RATIO OF NOVARTIS 6.86 32.1 112.6 143.5 INTEREST-COVERAGE RATIO 0.01 0.01 0.01 0.01 L.T. DEBT TO EQUITY 2003-2004 2004-2005 2005-2006 2006-2007 RATIO
    • GRAPH OF NET PROFIT MARGIN
    • GRAPH OF RETURN ON NET WORTH
    • GRAPH OF RETURN ON EQUITY
    • GRAPH OF P/E
    • GRAPH OF EPS
    • DIVIDEND PER SHARE @ F.V. of Rs. 5 300 200 100 Rs. % of FV
    • DIVIDEND PAYOUT RATIO
    • BETA FOR NOVARTIS Beta value for Novartis for the year 2006-2007 is
    • REFERENCES
      • Annual Reports of Novartis India
      • www. novartis .com
      • www. moneycontrol .com
      • www.money. rediff .com
      • www. myiris .com
    • THANK YOU