Market Research Report : Pharmacy retail market in india 2014

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  • Gaurav, great report. Do you have any idea on what is the average business transaction happening at each pharmacy, or the average number of prescriptions a retail pharmacy processes in a day, and the average value of the prescriptions. Would like to connect with you. I am Nishad 8886148649 nishad4321@gmail.com
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  • Great Market Trending research for projecting sales and future marketing tactics.
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Market Research Report : Pharmacy retail market in india 2014

  1. 1. Pharmacy Retail Market – India April 2014
  2. 2. 2 SAMPLEExecutive Summary Market Drivers & Challenges Competitive Landscape  The Indian pharmacy retail market is valued at INR xx bn and is estimated to reach INR xx bn by 2018  The market is distinctly fragmented into organized and unorganized players with a major share of the market being dominated by the unorganized segment Drivers  Growth in Pharmaceuticals Sector  Rising Healthcare Expenditure  Changing Disease Profile  Growth in OTC Segment  Consumer Attitude  Attractive Margins Trends Challenges  Capital Intensive Business  Fragmented Industry  Counterfeit Drugs  Loyalty Schemes  Value Added Services  Health Insurance Plans Made Available in Pharmacy segment  Tele Consultation Services  Entry of Government in Pharmacy Retailing  Organized Retailers Starting Pharmacy Chains  Entry of Private Labels  Rural Expansion  Tracking of Counterfeit Drugs Key Players Apollo Pharmacy Ltd. Emami Frank Ross Ltd. The Himalaya Drug Company Medica Health Shoppe MedPlus Health Services Pvt. Ltd. Religare Wellness Ltd. PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  3. 3. 3PHARMACY RETAIL MARKET IN INDIA 2014.PPT •Macro Economic Indicators •Introduction •Market Overview •Government Regulations •Drivers & Challenges •Industry Association •Key Trends •Technology Adoption •Competitive Landscape •Strategic Insights •Appendix
  4. 4. 4 SAMPLE Healthcare system in India requires a larger public outlay due to the huge population base Healthcare Industry Overview • According to “World Health Statistics 2013 Report, India”, healthcare comprised 3.7% of India’s GDP in 2010  General government expenditure on health as percentage of total expenditure on health in 2010 was 28.2% • Favorable demographics, increase in awareness levels and better medical care are some factors that are driving healthcare sector in India • Hospitals form the largest segment of overall healthcare market, followed by pharmacy, medical equipments, diagnostics and thereafter, medical insurance • Gradual penetration of health insurance is stepping up affordability of health services through increased demand for preventive and curative healthcare services • Superior quality healthcare, coupled with low treatment cost in comparison to other countries, is benefitting Indian medical tourism, thereby steering forth Indian healthcare market  Treatment for major surgeries in India costs approximately 20% of that in developed countries Healthcare Sector – Market Size & Growth Market Segmentation – Overview (20--) PHARMACY RETAIL MARKET IN INDIA 2014.PPT x x x 0 x x 2015e 2016e x 2017e x 2014e x 2012 x INR tn x X% 2018e2013 16.2% 21.3% 0.9%3.4% 7.2% 50.9% x x x x x x
  5. 5. 5 SAMPLE Disparity in income levels across population strata results in income elasticity of demand for healthcare 44% 41% 36% 27% 11% 11% 42%Doctor/ Surgeon’s Fees Hospital/ Nursing Home Fees Medicine 21% 62% Medical Diagnostics 53% 35% 17% x xx •xxx Healthcare Expenditure of Population by Economic Standard PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  6. 6. 6 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Unorganized segment dominates a large volume of the pharmaceutical retail market • Indian pharmacy retail stands out as a lucrative market that still remains under penetrated, projecting strong potential • The Indian pharmacy market is ranked xth in terms of value and xth in terms of volume • The pharmaceutical sector on the whole contributes a share of x-x% to India’s GDP • The market is distinctly fragmented into organized and unorganized players  There are approximately x to x stores across the country • The unorganized market is huge and is roughly valued at INR x bn occupying x% of the total market size while organized market is valued at approximately INR x bn capturing close to x% of market share  The unorganized pharmacy retail market is growing at a CAGR of x% while organized pharmacy retail is expected to grow at a CAGR of x%  There should be a significant change in the market segmentation by 20-- when organized retail will capture approximately x% market from the current x% share • In India, pharmacies are the dominant distribution channels generating approximately x% of overall pharmaceutical sales Market Overview 0 500 1,000 1,500 2,000 INR bn X% 2018e x 2017e x 2016e x 2015e x 2014e x 2013 x Market Size and Growth Market Segmentation 13.5%12.8%12.1%11.2%10.5% 0% 20% 40% 60% 80% 100% 87.2% % 2018e 85.8% 14.2% 2017e2016e 86.5% 2015e 87.9% 2014e 88.8% 2013 89.5% x x
  7. 7. 7 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Pharmacy industry has an elongated distribution chain before the products reach the retail outlets Manufacturer Central Warehouse Super Stockist Sub Stockist Stockist Hospitals Retail Outlets Long channel of distribution and high possibility of brand substitution makes it mandatory for a company to make its stock keeping units available all the time
  8. 8. 8 Government Role: Summary Role of Government Licence Procurement Foreign Direct Investment Ownership Restrictions PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  9. 9. 9PHARMACY RETAIL MARKET IN INDIA 2014.PPT Drivers & Challenges Drivers Growth in Pharmaceuticals Sector Rising Healthcare Expenditure Changing Disease Profile Growth in OTC Segment Consumer Attitude Attractive Margins Challenges Capital Intensive Business Fragmented Industry Counterfeit Drugs
  10. 10. 10 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Rising health related expenditure is a strong determinant of growth for pharmacy retail market… • Healthcare spending has increased with rise in disposable income  A middle class family earns an average annual income that ranges between INR 0.34mn to INR 1.7mn according to 2009-10 price levels  Growing affordability among large middleclass population has raised demand for better health services • The pharmacy expenditure is almost always borne out of pocket that gives a major boost to retail outlets  About x% of Indian healthcare expenditure is essentially out of pocket (OOP) of which x% is accrued on pharmacy products Rising Healthcare Expenditure (1/x) Impact 22% 78% x x Average Health Spending (2011-12) 72% 28% xx Middle Class Population Growth Projection 113.8 53.331.4 547.0 267.0 160.0 0 100 200 300 400 500 600 2025e 8.5% 2010 2015e mn xx
  11. 11. 11 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT 24% 23% 8% 45% Favorable consumer attitude and attractive margins are driving growth in pharmacy retailing in India • Indian consumers confidently self-treat a wide range of common ailments such as cough, cold, fever, pain and sprains, heartburn and diarrhea • There is a growth in consciousness among majority of Indian population towards a healthy lifestyle that inculcates a habit among them to spend on personal well being  This is in turn fueling the growth in pharmacy retailing business • New age consumers demand congenial environment that is quick, efficient and comfortable  This is likely to promote the growth in the business of organized pharmacy retail chains Consumer attitudes Impact • High margins in pharmacy retailing despite price controls have made it a lucrative business • Retailers are entitled to margins of 16% for controlled formulations and 20% for decontrolled formulations on MRP Attractive margins Level Margins Retailers Scheduled Drugs Non-scheduled Drugs x% x% Behaviour towards Minor Ailments Impact x xx x
  12. 12. 12 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Pharmacy retail business is a capital intensive proposition that involves strategic location of outlets Capital Intensive Business Impact • Pharmacy retailing is a capital intensive business proposition • Pharmacy retailing stands out as a catchment specific business • Pharmacy retail in today’s scenario essentially involves store expansion and its multiplication  Each store involves an approximate cost of to set up and start operation  Each store requires minimum to breakeven Pharmacy Retail Business – A Catchment Specific Business Hospital area Commercial area Success Involves Proximity To Spells burden on the business operators due to prohibitive real estate cost in such areas
  13. 13. 13PHARMACY RETAIL MARKET IN INDIA 2014.PPT Key Trends `Trends Loyalty Schemes Value Added Services Health Insurance Plans Made Available in Pharmacy Tele Consultation Services Entry of Government in Pharmacy Retailing Organized Retailers Starting Pharmacy Chains Entry of Private Labels Rural Expansion Tracking of Counterfeit Drugs
  14. 14. 14PHARMACY RETAIL MARKET IN INDIA 2014.PPT Technology Adoption: Summary Technology Trends Customer Relationship Management Supply Chain Management Enterprise Resource Planning
  15. 15. 15 SAMPLECompetitive Benchmarking (1/x) Public Trading Comparables (FY 20--) Player 1 Player 2 Player 3 Market Capitalization (INR mn) 138,582.6 130,731.9 137.872 Share Price (INR) 904.35 980.00 0.90 EV/EBITDA (INR mn) 22.55 14.14 13.40 EV/Revenue (INR mn) 3.78 2.44 23.89 PE Ratio N.A. 24.32 0.18 PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  16. 16. 16 SAMPLEKey Ratios of Top 3 Companies – Operational Basis (FY 2013) (1/3) Competitive Benchmarking (2/x) 97.61 -21.34 13.30 97.61 -134.54 0.08 -150 -100 -50 0 50 100 Player 2 Player 3 % Player 1 Net Margin Operating Margin • xxx PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  17. 17. 17 SAMPLEPublic: Domestic Company – Player 1 (x/x) Key PeopleProducts and Services Company Information Offices and Centres – India Corporate Address Tel No. Fax No. Website Year of Incorporation Ticker Symbol Stock Exchange Category Products/Services Pharmacy Retail Chain xxx Online Retail xxx Name Designation xxx xxx xxx xxx xxx xxx xxx xxx Chennai Head Office PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  18. 18. 18 SAMPLEKey Ratios Financial Summary • The company incurred a net profit of INR 3.03 bn in FY 2013, as compared to net profit of INR 2.18 bn in FY 2012 • The company reported total income of INR 38.09 bn in FY 2013, registering an increase of 17 per cent over FY 2012 • The company earned an operating margin of 13.19 per cent in FY 2013, an increase of 0.68 percentage points over FY 2012 • The company reported debt to equity ratio of 0.44 in FY 2013, an decrease of 35.41 per cent over FY 2012 Financial Summary Indicators Value (dd/mm/yyyy) Market Capitalization (INR mn) 138,582.6 Total Enterprise Value (INR mn) 131,177.0 EPS (INR) N.A. PE Ratio (Absolute) N.A. Particulars y-o-y change (2013-12) 2013 2012 2011 2010 Profitability Ratios Operating Margin 0.63 13.19% 12.55% 12.51% 10.86% Net Margin 1.09 7.95% 6.86% 6.94% 6.50% Profit Before Tax Margin 0.23 10.70% 10.47% 10.26% 9.78% Return on Equity 2.29 10.95% 8.66% 9.48% 7.98% Return on Capital Employed 0.07 12.24% 12.17% 10.98% 8.76% Return on Working Capital -59.08 59.76% 118.84% 133.55% 45.61% Return on Assets 0.42 10.38% 9.96% 9.06% 6.86% Return on Fixed Assets 0.15 19.59% 19.44% 18.28% 14.24% Cost Ratios Operating costs (% of Sales) -0.54 86.77% 87.31% 87.38% 88.95% Administration costs (% of Sales) -0.18 3.31% 3.49% 3.73% 3.11% Interest costs (% of Sales) -0.16 2.40% 2.56% 2.84% 2.71% Liquidity Ratios Current Ratio 46.69% 2.15 1.46 1.39 1.69 Cash Ratio 1.91% 1.10 1.08 1.05 0.98 Leverage Ratios Debt to Equity Ratio 35.41% 0.44 0.32 0.50 0.55 Debt to Capital Ratio 24.61% 0.31 0.24 0.33 0.35 Interest Coverage Ratio 11.29% 5.51 4.95 4.45 4.07 Efficiency Ratios Fixed Asset Turnover -3.35% 1.48 1.53 1.45 1.29 Asset Turnover -0.06% 0.79 0.79 0.72 0.62 Current Asset Turnover -18.57% 2.41 2.96 2.96 1.69 Working Capital Turnover -51.76% 4.52 9.37 10.58 4.13 Capital Employed Turnover 1.23% 0.96 0.94 0.90 0.78 Improved Decline Financial Snapshot Total Income Net Profit / Loss 20 0 0 1 330 4 2 10 40 2.18 2012 INR bn 3.03 INR bn 2013 38.0931.80 20.62 2010 1.82 2011 1.34 26.29 Public: Domestic Company – Player 1 (x/x) PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  19. 19. 19 SAMPLEKey Business Segments Key Geographic Segments Business Highlights Public: Domestic Company – Player 1 (x/x) Description News Overview • Xxx xxx • xxx xxx • xxx 25% 27% 29%3%2%1%24% 0% 50% 100% 2013 4% 67% 2012 70% 2011 73% 2010 75% xxxxxxxxx 100% 80% 60% 40% 20% 0% 2013 100% xxx xxx PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  20. 20. 20 SAMPLE • xxx • xxx • xxx• xxx TO WS Public: Domestic Company – Player 1 (x/x) PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  21. 21. 21 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Private: Domestic Company – Player 2 (x/x) Key People Products and Services Company Information Offices and Centres – India Corporate Address Tel No. Fax No. Website Year of Incorporation Name Designation xxx xxx xxx xxx xxx xxx Category Products/Services xxx xxx xxx xxx xxx xxx Kolkata Head Office
  22. 22. 22 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Shareholders of the Company Ownership Structure Name No. of Shares held xxx 39,000 xxx 78,400 xxx 10,000 xxx 10,000 xxx 10,000 xxx 5,000 xxx 1,930,307 Total 2,082,707 Private: Domestic Company – Player 2 (x/x) 73.1% 73.1% 73.1% 24.6% 2.2% 100.0% 2011 0.4% 100.0% 2013 0.4% 26.5% 2012 26.5% 100.0% xxxxxx xxx
  23. 23. 23 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Financial Snapshot Key Ratios Financial Summary • Company earned a net profit of INR 1.61 mn in FY 2013, as compared to net profit of INR 6.78 mn in FY 2012 • It reported total income of INR 1997.55 mn in FY 2013, registering an increase of 7 per cent from FY 2012 • Earned an operating margin of 13.30 per cent in FY 2013, a decrease of 0.41 percentage points over FY 2012 • The company reported a debt to equity ratio of 14.13 percentage points in FY 2013, a decrease of 2.85 per cent over FY 2012 Improved Decline Particulars y-o-y change (2013-12) 2013 2012 2011 2010 Profitability Ratios Operating Margin -0.41 13.30% 13.71% 16.95% 10.13% Net Margin -0.29 0.08% 0.37% 2.84% 2.45% Profit Before Tax Margin 0.47 0.09% -0.38% 4.11% 2.06% Return on Equity -8.16 2.47% 10.63% 38.13% 35.49% Return on Capital Employed 1.28 26.83% 25.55% 27.84% 22.34% Return on Working Capital 2101.78 127.84% -1973.95% -414.62% 30.43% Return on Assets 0.56 20.78% 20.22% 22.34% 22.34% Return on Fixed Assets -6.13 110.03% 116.17% 103.02% 88.01% Cost Ratios Operating costs (% of Sales) 0.46 86.63% 86.18% 82.98% 89.81% Administration costs (% of Sales) N.A. N.A. N.A. N.A. N.A. Interest costs (% of Sales) -0.14 5.79% 5.93% 3.56% N.A. Liquidity Ratios Current Ratio 30.17% 1.28 0.99 0.93 4.87 Cash Ratio 19.51% 0.06 0.05 0.03 0.17 Leverage Ratios Debt to Equity Ratio -2.85% 14.13 14.54 7.16 5.57 Debt to Capital Ratio -0.19% 0.93 0.94 0.88 0.85 Interest Coverage Ratio -0.94% 2.31 2.33 4.79 N.A. Efficiency Ratios Fixed Asset Turnover -2.05% 8.23 8.40 6.05 8.64 Asset Turnover 6.25% 1.55 1.46 1.31 2.19 Current Asset Turnover 11.17% 2.12 1.91 1.78 2.37 Working Capital Turnover -106.70% 9.56 -142.80 -24.36 2.99 Capital Employed Turnover 5.70% 30.36 28.72 13.35 14.41 Private: Domestic Company – Player 2 (x/x) Net Profit/LossTotal Income 50 40 10 30 20 0 2000 1500 1000 500 0 INR mnINR mn 2013 1.6 1997.6 2012 6.8 1848.7 2011 45.0 1582.9 2010 33.2 1353.0
  24. 24. 24 SAMPLE PHARMACY RETAIL MARKET IN INDIA 2014.PPT Description News Overview • XXX xxx • XXX xxx • XXX Business Highlights Private: Domestic Company – Player 2 (x/x)
  25. 25. 25 SAMPLE • xxx • xxx • xxx• xxx TO WS Private: Domestic Company – Player 2 (x/x) PHARMACY RETAIL MARKET IN INDIA 2014.PPT
  26. 26. 26 Thank you for the attention About Netscribes, Inc. Netscribes, Inc. is a knowledge-consulting and solutions firm with clientele across the globe. The company’s expertise spans areas of investment & business research, business & corporate intelligence, content-management services, and knowledge-software services. At its core lies a true value proposition that draws upon a vast knowledge base. Netscribes, Inc. is a one-stop shop designed to fulfil clients’ profitability and growth objectives. Pharmacy Retail Market – India report is part of Research on India’s Healthcare Industry Series. For any queries or customized research requirements, contact us at: Disclaimer: This report is published for general information only. Although high standards have been used in the preparation, “Netscribes” is not responsible for any loss or damage arising from use of this document. This document is the sole property of Netscribes and prior permission is required for guidelines on reproduction. Follow us on: Phone: +91 22 4098 7600 E-Mail: info@netscribes.com PHARMACY RETAIL MARKET IN INDIA 2014.PPT

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