Sakar Healthcare Limited has informed the Exchange about Investor Presentation
.....
,.:-
Certified ISO 9001 : 2015 by
Sakar
Healthcare Limited
Corporate Office: 406, Silver Oaks Comm. Complex, Opp. Arun Society, Paldi, Ahmedabad-380 Phone Fax: CI No.: E-mail Web
: 079-26584655 079-26588054 L24231 GJ2004PLC043861 : info@sakarhealthcare.com : www.sakarhealthcare.com
007. Gujarat,
India.
08-10-2022
The Manager, Listing Compliance Department, National Stock Exchange of India Ltd, Exchange Plaza, Bandra Kurla Complex, Bandra (East), Mumbai - 400051
Dear Sir,
Symbol: SAKAR
Subject: Announcement under Regulation 30 (LODR) - Investor Presentation/Corporate Presentation
Please find attached herewith the Investor Presentation/Corporate information, Disclosure Requirements) Regulations, 2015, as amended from time to time.
Presentation. This is for your records and meeting the disclosure requirements under the SEBI (Listing Obligations and
Thanking you,
Yours faithfully, for SAKAR HEALTHCARE LIMITED
BHARATSONI COMPANY SECRETARY & COMPLIANCE OFFICER
Regd. Office / Works:
Block
'0. 10-13, Sarkhej-Bavla
Road, Village Changodar, Dist. Ahmedabad
- 382 213.
lndia
Phone:
02717 250477
Fax:
02717 251621
Investor Presentation
October 2022
Contents 03
Sakar Healthcare in a Nutshell
05
16
22
24
27
Business and Operational Overview
Next Phase of Growth in Oncology
Key Strengths
Pharma Industry Overview
Financial Performance
Sakar is at crux of next phase of growth, prepared to enter the niche segment of Oncology to cater to humanity. Sakar is well equipped to deliver High Precision Research works, suitably followed by Technology Transfer and Scale-up to commercialize Anti-Cancer products worldwide.“
Mr. Sanjay Shah, Chairman and MD Sakar Healthcare Limited
Sakar Healthcare in a Nutshell
Indian pharmaceutical manufacturing company since 2004
Established by first generation entrepreneur Mr. Sanjay Shah in 2004 in Changodar, Gujarat, India. Started with manufacturing Oral Liquid as a Contract Manufacturer for pharma multinationals (CMO).
Sakar manufactures and markets 175 products, with 292 Registrations under its own name covering more than 24 therapeutic areas to 60 international markets.
Over a period of time diversified into manufacturing wide range of Pharmaceutical Formulations. viz.
Liquid Injectables (Vials and Ampoules)
Lyophilized Injections (Vials)
Oral Solid (Tablet/Capsule/Dry Syrup)
Oral Solid (Dry Powder Syrup)
Dry Powder Injections
In FY21, forayed into Oncology by setting-up a greenfield integrated unit at Bavla, Gujarat, India which will contribute to the next phase of growth at Sakar Healthcare.
Initial Public Offering of ₹ 14.81 Cr at issue price ₹ 50/share in Oct.2017. In Jan.2019 migrated from SME Platform to main board NSE
Sakar is presently engaged in developing, manufacturing (CDMO) & export of Pharmaceutical Finished Dose Formulations worldwide.
Sakar Healthcare Limited
3
Sakar Healthcare in a Nutshell
Key financial numbers FY22
ICRA BBB/A3+ Credit Rating
450+ Workforce
60+ Countries Present
175+ Formulations
Sakar Healthcare Limited
292+ Registered Brands
24+ Therapeutic Areas
64.5+ Promoter Holding
79+ Overseas Partners
12,823
Revenue from Operations (In ₹ Lakh)
2,940
EBIDTA
22.9%
EBIDTA(%)
1,501
PAT
11.5%
PAT(%)
25% CAGR%*
24% CAGR%*
36% CAGR%*
*FY18 to FY22
4
Business and Operational Overview
Business Model Therapeutic Segments Formulation Segmentation Marquee Customers Global Footprint State of Art Manufacturing Facility Leadership and Management
01
Transformation of Business Model
Business Vertical Contribution
FY18
18%
29%
53%
CDMO / CMO
Own Brand Export
Loan Licensing
FY22
5%
22%
73%
CDMO / CMO
Own Brand Export
Loan Licensing
CDMO: Operates as a Contract Development & Manufacturer for leading Multinational Pharmaceutical Companies in India & Overseas.
Own Brand Export: Exports constitute of Sakar's own formulation brands to over 60 countries across generics market.
Loan Licensing: Involves necessary conversion and packaging of the product into finished formulation.
Sakar Healthcare Limited
6
Transformation of Business Model
Revenue from each Business Segment (In ₹Lakh)
CDMO
Export
Loan Licensing
9,368
25% Export CAGR
6,925
5,710
3,581
2,792
2,375
2,793
1,536
980
869
1,913
1,910
675
639
662
FY18
FY19
FY20
FY21
FY22
Over the years, the growth has come from developing, manufacturing & marketing formulations under Sakar's own Registered Brands primarily to APAC, Latin America, East & French- West Africa, CIS, Europe, etc.
Going forward, revenue will add-on from Oncology; high growth and margin expansion is expected in the business considering high entry barrier to the segment.
Sakar Healthcare Limited
7
Exposure to several Therapeutic Segments
Width of Therapeutic Segments
Anti-infective
Analgesic
Anti-Histamine
Anti-Malaria
Antacid
Anesthetic
1
2
3
4
5
6
7
8
9
10
11
12
Anticoagulant
Antipsychotic
Anti-depressant
Antiematic
Anti-fungal
Adrenergic
Anthelmintic
Bronchodilator
Anti-Inflammatory
Duiretic
Anticonvulsant
Laxative
13
14
15
16
17
18
19
20
21
22
23
24
Oxytocic
Proton Pump Inhibitor
Sedative
Vitamins
Psychostimulant
Cough expectorant
Top 5 Therapeutic segments are Proton pump Inhibitors, Antibiotic, Analgesic, Anti Coagulant, Anti Malarial.
Diverse basket of products made Sakar an one-stop solution to 79 operating partners & around 12 new prospects.
Sakar has forayed into Oncology with vertically integrated unit to meet the increased demand in this category.
Sakar Healthcare Limited
8
Formulation Segmentation
57%
25%
Top 10
Contributed by Injectable group
Contributed by Oral Solid Dosage (OSDs)
Molecules contribute nearly +45% of the export sales
Oral Liquid
Key Molecules:
The liquid form is the most acceptable dosage form across age groups. It is normally available in sealed glass or pet bottles in different volumes.
-Metronidazole (Antibiotic) -Nystatin (Anti fungal) -Ambroxil,Terbutaline, Guaphenisin (Cough expectorant)
Liquid Injections (Vials & Ampoules)
They are meant for administration inside veins or muscles in human body and are manufactured aseptically.
Lyophilized Injection (Vials)
Lyophilization is the process commonly known as Freeze Drying which helps enhance the product stability. It is manufactured in a Lyophilizer.
Key Molecules:
-Tramadol (Analgesic) -Diclofenac (Anti inflammatory) -Heparin (Anti coagulant)
Key Molecules:
-Pantoprazole (Proton Pump Inhibitor) -Omeprazole (Proton Pump Inhibitor) -Vancomycin (Antibiotic)
Sakar Healthcare Limited
9
Formulation Segmentation
Oral Solid (Tablet/Capsule/Dry Syrup) Cephalosporin
Cephalosporins are antibiotics used to treat a wide variety of bacterial infections, such as respiratory tract infections, skin infections and urinary tract infections. This is the most widely used formulation type.
Oral Solid (Dry Powder Syrup)
Dry Powder need to be reconstituted prior administration and is intended for paediatric use.
Dry Powder Injections Cephalosporin
Dry powder injections are stable and need to be reconstituted with WFI prior administration inside veins or muscles in human body.
Key Molecules:
-Cefuroxime (Antibiotic) -Cefpodoxime (Antibiotic) -Cefalexin (Antibiotic)
Key Molecules:
-Cephalexin (Antibiotic) -Cefixime (Antibiotic) -Cefpodoxime (Antibiotic)
Key Molecules:
-Cefotaxime (Antibiotic) -Ceftriaxone (Antibiotic) -Ceftazidime(Antibiotic)
Sakar Healthcare Limited
10
Value derived from each Formulation Segments
Oral Liquid (In ₹ Lakh)
Liquid Injections (Vials & Ampoules) (In ₹ Lakh)
537
441
392
559
602
6,444
4,246
4,998
3,462
2,351
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
The products manufactured have application across wide range of therapeutic segments, in addition Sakar can cater to the customers present across regions which ensures a sustainable business model.
Sakar's diversified product portfolio has helped accelerate growth, improve profitability and thus retain both new and existing customers.
Oral Solid (Tablet/Capsule/Dry Syrup) (In ₹ Lakh)
Dry Powder Injections (In ₹ Lakh)
Lyophilized Injection (Vials) (In ₹ Lakh)
1,277
1,264
1,597
1,953
2,005
484
320
1,791
796
861
903
438
251
13
53
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
Notes: (1) Numbers have been rounded off
Sakar Healthcare Limited
11
Servicing Multinational Marquee Customers (CDMO / CMO)
Esteemed customers in CDMO
Belief, trust and support of customers
9
9
8
11
10
12
5
4
15
15
16
Most of these companies ranked amongst top 20 in Indian Pharmaceutical industry and trust Sakar for manufacturing their brands over the years.
Domestically, the company does contract manufacturing for marquee pharmaceutical clients which comprises 15% of revenue in total.
CDMO, being the EU GMP approved CMO for leading multinational pharmaceutical companies: works in association for product development with technology transfer & commercial supplies from European clients.
Sakar Healthcare Limited
12
Continuously expanding Global Footprint
Sakar's presence in 60 countries on global map
85%
Contribution by top 15 countries in FY22
Sakar Healthcare Limited
In the year 2008, Sakar began exports with African region; ever since every five years expanded to different regions. Very recently began exports to Europe.
Regulatory approvals received from national drug authority of
Europe (Croatia)
Canada
Cambodia
Columbia
Vietnam
Kenya
Ethiopia
Nigeria
Uganda
Philippines
Peru
DR Congo
Zimbabwe
Yemen
Ghana
Ivory Cost
Malawi
ISO 9001:2015 Bureau Veritas certification
13
State of the Art Manufacturing Facility
Changodar, Ahmedabad, Gujarat, India
Manufacturing facility started since 2004.
The plant is approx. 45 Kms away from Sardar Vallabhai Patel International Airport, Ahmedabad and approx. 300 Kms from Kandla.
Installed Solar power unit that saves up to a third of the total power consumptions; thereby limits environmental pollution and improves cost efficiency.
Plant Capacity Utilization
Block
Facility
Built up area (Sq Meters)
Annual capacity (Single shift)
Capacity Utilization (FY22)
Block 1
Oral Liquid Syrup & Suspension
Block 2
Block 3
Antibiotics Tablets & Capsules
Antibiotics Dry Syrup & Sachets
Liquid Injectable (SVP)-Vial & Ampoule
Lyophilised Injection-Vial
Block 4
Antibiotic Dry Powder Injection
Total Units
2,266
2,960
5,073
1,980
80,64,000
332,40,000
60,48,000
907,20,000
43,20,000
120,96,000
1544,88,000
57%
62%
49%
71%
54%
74%
67%
Sakar Healthcare Limited
14
The Force behind Sakar's Growth Leadership and Management
Mr. Sanjay Shah Chairman & MD
Mr. Aarsh Shah JT. MD
Ms. Rita Shah Whole Time Director
Mr. Shailesh Patel Independent Director
BSc from Gujarat University
Electrical Engineering
Look after the following departments: Administrative, Procurement of materials, Production and Controlling of quality products
Experience of more than 28 years in the field of Electrification
Pharmacist plus MBA from University of Cardiff, UK
Looks after production, international sales and marketing and developing business relations
▪ MBA from Vikram University
plus a course in Plastic Technology
▪ More then 3 decades of
experience in pharmaceutical, mineral- water and plastic industry.
Prior to Sakar, he promoted bottling of mineral water since 1986.
Presently manages the corporate strategy, business planning and finance.
Mr. Prashant Srivastav Independent Director
Chartered Accountant and Company Secretary
Experience of more than 13 years in the field of Banking Accounts and Finance
Mr. Hemendra Shah Independent Director
B.Com, LL.B, M.Com as well as qualified Cost and Management Accountant (ACMA) and Company Secretary (ACS)
▪ Over 38 years of Experience in Finance,
Cost & Management Accounting, Banking, Taxation Secretarial, Insurance & other related matters.
Sakar Healthcare Limited
15
▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ ▪ Next Phase of Growth- Oncology
Greenfield Integrated Oncology Unit Oncology Business Model World Class Facility that supports
Sustainability- Green Chemistry
Global Oncology Scenario Rationale for Diversifying into Oncology
02
Greenfield Integrated Oncology Unit Started Operations in Sept.2021
Research-driven API-Integrated Finished Dosage Formulation Plant
The standalone unit covers are of 39,121 m2 functioning with -
An up-to-date Analytical An up-to-date Analytical Development Lab Development Lab
Formulation Development Formulation Development Lab, Research Development Lab, Research Development
Lab with modern flow Lab with modern flow chemistry technique chemistry technique
Comprehensive and Comprehensive and updated Pharmaceutical updated Pharmaceutical Product Product
Powder processing unit with Powder processing unit with dedicated ETP and Utilities dedicated ETP and Utilities
Manufacturing Finished Manufacturing Finished Formulations for Formulations for 1. Oral Solid (Tablet, 1. Oral Solid (Tablet,
2. 2.
Capsule) Capsule) Injections (Liquid & Injections (Liquid & Lyophilised) Lyophilised)
22 Technical Experts with domain experience of over 15 years
Sakar Healthcare Limited
Project Cost
₹194*
crore
Debt Funding Sanctioned
₹95crore
through Bank Loans
Equity Funding Cobra invested
₹14.85crore in
Mar.21 and HBM PE Healthcare Fund invested
₹24crore in
June.22; Holding 14% Equity. Balance through promoter’s contribution & Internal Accruals
Expected Completion R&D, OSD & API units are Operational. Injectables will begin in early Mar.23.
* Project Cost has been approved by GITCO through tecno commercial economic viability assessment
17
Oncology Business Model
Sakar’s Positioning in Oncology
Sakar forayed into a different product line by Sakar forayed into a different product line by setting-up greenfield manufacturing unit at setting-up greenfield manufacturing unit at Bavla, Gujarat, 15 minutes from the exiting unit. Bavla, Gujarat, 15 minutes from the exiting unit.
Sakar is positioned as a PREMIUM CDMO to partner: Sakar is positioned as a PREMIUM CDMO to partner: o Research & Product development o Research & Product development o Scale up pilot/commercial batches o Scale up pilot/commercial batches o API o API o Technology Transfer o Technology Transfer o Finished Formulations (OSD & Liquid /Lyophilized o Finished Formulations (OSD & Liquid /Lyophilized
injections) injections)
EXPORT of Sakar brands to overseas markets / EXPORT of Sakar brands to overseas markets / existing channel partner network to get leverage existing channel partner network to get leverage
Sakar Healthcare Limited
18
World Class Facility that supports Sustainability- Green Chemistry
Green Chemistry
12 principles
1
Prevent waste
2
Maximize atom economy
3
Less hazardious chemical syntheses
4
Safer chemicals & products
Modern machinery and equipment’s
1. Vapourtec R Series System, UK 2. Glass Line Reactors from De-Dietrich, Italy 3. OSD Containment Granulation and Compression Line, GEA, Belgium 4. Glatt-Autocoater, Germany 5. Tablet Capsule Inspection Machine by Sensum, Slovenia 6. Sterile Manufacturing Line with Lyophiliser, Tofflon 7. Kevin Roll Compacter 8. Bulk packaging Line IMA, Germany
5
Safer solvents & reaction- conditions
6
Increase energy efficiency
7
Use renewable feedstocks
8
Avoid chemical derivatives (protein groups)
9
Use catalysts
10
Design chemicals & products to degrade after use
11
Analyse in real time to prevent pollution
12
Minimize potential for accidents
Enables Green Chemistry
Adopted techniques like Flow-Chemistry (Vapourtech) - safer with small reaction volumes, low solvent-reagent, low risk of environment exposure
GEA containment line supports Green Chemistry principles
▪ Designs and processes are in place to suit Green
Chemistry objectives
▪ Newly installed facility along with world class equipment, provides Sakar competitive edge.
Sakar Healthcare Limited
19
▪ ▪ Global Oncology Scenario
Oncology Market ($ billion)
Product Sales, 2019 ($ billion)
Number of phase I to regulatory submission oncology pipeline products by company segment, 2011-2021
10.2%
CAGR
522
11.1
11.1
8.0
7.1
6.5
6.1
5.7
271
2021
2028E
Keytruda (Merck)
Revlimid (Celgene)
Opdivo (Bristol Myers Squibb)
Avastin (Roche)
Rituxan (Roche)
Herceptin (Roche)
Imbruvica (AbbVie)
0 7 8
1 1 0 2
1 1 9
2 1 0 2
2 7 8
3 1 0 2
1 0 9
4 1 0 2
3 0 0 1
,
5 1 0 2
1 3 1 1
,
6 1 0 2
9 6 1 2
,
7 9 1 2
,
5 4 8 1
,
7 7 5 1
,
2 4 3 1
,
7 1 0 2
8 1 0 2
9 1 0 2
0 2 0 2
1 2 0 2
▪ Global oncology market is growing at a
CAGR of 10.2%
Cancer medicine spending rose to $185 Bn globally in 2021 and is expected to reach more than $300 Bn by 2026
20% of the Global Pharmaceutical sales account to Oncology
Top 10 pharmaceutical companies in the world are invested with oncology
Top MNCs are into active acquisition, collaboration for Oncology portfolio with an avg. deal value exceeding $5 Billion (Pfizer, AbbVie, Genmab, etc.)
Emerging biopharma companies are responsible for 68% of products currently under development for cancers, an increase from 47% in 2016
▪ Oncology trial starts reached historically high levels in 2021, up 56% from 2016 and mostly focused on rare cancer indications, which have higher success rates despite greater complexity
Top 7 products with sales of > $5 Billion
In last 5 years, many molecules and efforts have been put in covering the most prevalent cancers like Thyroid, Breast, Prostate, NSLC and Multiple Myeloma cancer
Source: McKinsey, Delivering Innovation: 2020 Oncology market, Global Oncology Market Report 2028, IQVIA – Global Oncology Report 2022
Sakar Healthcare Limited
20
▪ ▪ ▪ ▪ ▪ ▪ ▪ Rationale for Diversifying into Oncology
Presence of limited players in India for both API & finished formulations in Oncology due to high entry barriers thereby ensuring healthy competition.
Majority of the players have presence in
regulated market with less players having presence in semi-regulated markets where Sakar has firm presence since over a decade.
Exhaustive range of off-patent products
in the pipeline; thereby enhancing growth opportunities
Oncology being margin accretive supported by strong growth drivers across geographies.
Sakar’s objective was to enter R&D with hi-tech equipment to cater to the global requirements.
Sakar has set-up a fully equipped state of the Art facility in Oncology and a fully integrated plant catering to R&D, OSDs, Injectables.
▪ Oncology products are cytotoxic in nature and
requires containment set-up and implementation of safety handling procedures which are in place.
New cancer cases in 2020 were 13,24,413 of which Breast cancer 13.5%, Oral cavity 10.3% , Cervix Uteri 9.4%, Lung 5.5%. The Indian Cancer market shows a healthy double-digit growth.
Indian government’s strong focus on introducing strategic initiatives to support setting-up, development and promotion of bulk drug and API manufacturing units in India by introducing various incentive schemes
Sakar Healthcare Limited
21
▪ Key Strengths
Diversified Product Profile, Geographies, Customers and Therapeutic Areas along with multi-end user industry.
Entry into the Regulated Markets of Europe, APAC will provide growth impetus
Product Pipeline under Registration 200+
An end-to-end solution provider with Vertically Integrated Oncology unit to ensure Research & Development, Pilot & scale-up of product batches up to commercial scale.
Key Strengths
Sakar is well placed to benefit from Industry Tailwinds: ▪ Growing export opportunity in ROW regions, specially after the environmental related shutdowns in China
Structural drivers in places for a robust domestic demand growth
Sakar Healthcare Limited
22
▪ Demonstrated business growth by diversifying into high value Product Mix, across Geographies
REVENUE FROM OPERATIONS1 (IN ₹ LAKH)
PROFITABILITY1 (IN ₹ Lakh) EBITDA & EBITDA Margin
PAT & PAT Margin
217
202
118
68
53
5,308
6,825
8,298
9,474 12,823
25% CAGR
23%
25%
24%
24%
23%
10%
14%
17%
22%
1,233
1,686
1,954
2,261
2,940
24% CAGR
437
653
958
1,074
1,501
36% CAGR
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
Revenue from Operation
Other Income
EBIDTA
EBIDTA Margin
PAT
PAT Margin
BALANCE SHEET RATIOS
RoE (%)
RoCE (%)
Debt to Equity
Debt to EBIDTA
8%
9%
12%
11%
12%
13%
14%
13%
11%
9%
0.2
0.1
0.2
0.4
0.7
0.8
0.5
0.7
1.7
2.8
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
FY18
FY19
FY20
FY21
FY22
Notes: (1) Numbers have been rounded off
Sakar Healthcare Limited
23
Disclaimer
Certain statements in this presentation concerning our future growth prospects are forward looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements.
The company's results may be affected by factors including, but not limited to, the risks and uncertainties in research and development; competitive developments; regulatory actions; the extent and duration of the effects of the COVID-19 pandemic; litigation and investigations; business development transactions; economic conditions; and changes in laws and regulations.
All information contained in this presentation has been prepared solely by Sakar Healthcare Limited. Sakar Healthcare Limited does not accept any liability whatsoever for any loss, howsoever, arising from any use or reliance on this presentation or its contents or otherwise arising in connection therewith
Sakar Healthcare Limited
24
Thank You
October 2022
SAKAR HEALTHCARE LIMITED
INVESTOR RELATIONS AT
Registered Office Block No. 10-13, Village: Changodar, Sarkhej-Bavla Highway, Taluka: Sanand, Ahmedabad- 382 213
Sakar Healthcare Bikramjit Ghosh bikramjit@sakarhealthcare.com
NSE: SAKAR ISIN: INE732S01012 www.sakarhealthcare.com
Copyright ©2022 Sakar Healthcare Limited
Krishna Patel, Krishna.patel2@in.ey.com
Advait Bhadekar advait.bhadekar@in.ey.com