With nothing much to look forward to in the present and having consumed the princely dividend of Rs 2/- per share one begins to gaze at the crystal ball of opportunities falling under Natcos lap in the medium term as there seems to be little respite in the short term, whatever was there has been sucked by the Trump Tariffs, so with what should we remain positive??
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The promoter management tried hyping up the 33% significant minority stake acquisition in branded low margin generic manuufacturer in south africa as being a pièce de résistance purchase but market immediately perceived it to be a damp squib (now natco will get a taste of its own medicine, how it feels to be a minority shareholder in a non perfoming company
). One can try to be optimistic about it and put it amongst the basket of eggs in terms of mid term opportunities. -
Domestic Semaglutide opportunity… by 2030 it is estimated that even if 50 lakh Indians are prescribed this wonderdrug the annual revenue potential could be north of 18000 crores INR
Assumptions being 50 lakh patients, Monthly cost at Rs.3000/- and the same would be prescribed for a 12 monhs period. How much share can we expect Natco to garner? -
Pomalidomide Settlement in USA could again be in the lines of Lenalidomide because both the patents were with Celgene and one can speculate that the settlement terms would be similar. I am speculating that the patent expires in 2031 so Natco should start selling in 2027. This could be a mini gRevlimid opportunity for Natco from 2027 - 2031.
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Semaglutide (Ozempic) sales in USA… the motherlode of opportunity awaits Natco Pharma and its partner Mylan… again based on the patent expiry in USA one would expect mylan to start selling generics by 2028. and in time even Wegovy settlment can be expected although the patent holder has a longer patent in Wegovys case and that is why perhaps it is holding out presently from settling.
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Acquisition opportunity. Rs1500 crores + whatever comes in this year + a 20% increase in Authorized Capital means the astute Mr. Nannapaneni Jr is contemplating another bigger piece de resistance. One can only hope its a majority stake this time.
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During this phase (2025 - 2030) maybe, just maybe ,the sinking stuttering still birth? for lack of other idioms, crop health division starts doing a significant annual topline of 500 crores and contributing to the net profits as well.
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NRC 2694A novel drug is undergoing phase II trials both in USA and in India. A success in these trials will definitey create excitement in the stock. Expect Natco to rope in a marketing partner for regulated markets and do the domestic sales themselves, if, it sees the light of the day.
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That blood clot removal drug Apixaban, breast cancer fighting Olaparib, Leukaemia drug Ibrutinib are all billion dollar plus revenue generating patent protected medicines for which Natco has either F2F or tentative approvals. The others in the para iv list as on date are also money spinners in their own right. A couple of them fruictoning would be conceivable and expected as well given Natcos past track record.
It may be a prolonged consolidation phase for Natco now and with 30% plus retail shareholders the patience will be thin and we could remain under the cloud, below the 200DMA and so on and so forth for many days. However, we should not lose sight of the whys that attracted us here and I find periodical review and recital of the same extremely therapeutic to hold on to this miserable wretched stock that is not perfoming for a good 9 years… the next headline, a decade of non performance?