Aurobindo Pharma has an established domestic and global presence in bulk drugs, drug intermediaries, formulations and sterile bulk drugs. It has seven manufacturing units in Andhra Pradesh and Pondicherry. Its customers include about 600 domestic formulators and over 200 overseas customers from about 70 countries.

The company’s turnover was Rs 740 cr in 1999-2000, representing a growth of 35% over the previous year. Net profit improved by 49% to Rs 74.6 cr . For the half year ended Sep.2000, turnover improved by 33% and net profit was Rs 46.41 cr, representing a subdued growth of about 25% due to a 254% increase in the tax provision from Rs 3.54 cr to Rs 9 cr.

The company is a leading manufacturer of semi-synthetic penicillin bulk actives and sterile products. It also manufactures and exports drug intermediaries like CMIC chloride, DICMIC chloride and various 4-methyl peperidone derivatives. The company’s domestic customers include Ranbaxy Laboratories, Cipla, Dr.Reddy’s Labs, Lupin Labs, IPCA, Torrent Pharma, etc.

The company is enhancing its presence in formulations, where the margins are higher. The sales of formulations during the second quarter ended Sep.2000 were Rs 18.18 cr as against Rs 6.91 cr in the same quarter of the previous fiscal. The merger of Sri Chakra Remedies Limited with the company in an all-stock deal is likely to add value through capacity addition and tax benefits. Th merged entity’s tax provision is likely to come down for the current year.

The company’s exports constituted 49.65% of the turnover in 1999-2000, up from 31.83% in 1997- 1998. Likewise, exports constituted 51.64% of the turnover in the Q2 of 2000-2001, thereby confirming the increased thrust on exports. The net (revenue) forex earnings of the company has spurted from Rs 11.63 cr in 1997-98 to Rs 100.33 cr in 1999-2000. With a steady depreciation in the value of the rupee, the renewed thrust on exports augurs well for the company.

The company is planning joint ventures in the US, China and Brazil. Its strategy for the US market will be to produce bulk drugs in India and formulate in US. The JV partner is expected to take care of regulartory issues, bioequivalence studies and ANda filings. Aurobindo Pharma will export cephalosporin bulk drugs to China, where it will be formulated.