Poly Medicure - at an inflection point!

(Abhishek Basumallick) #262


  • Revenue was 402.86 cr vs 381.9 cr in FY15

  • Net profit was 47.30 cr vs 61.01 cr (including 19.57 cr of exceptional items) in FY15

  • EPS was 10.72 vs 13.83 in FY15

  • PML is starting a new R&D center with an investment of 12.5cr which is to be operational by Q3 2016

  • New green field project at IMT Faridabad which is to be operational by Q3 2017 on an investment of 60cr

  • PML to focus on new market opportunities in Oncology, Nephrology & Respiratory Care segments

  • Product expansion is in process for Infusion therapy and Blood Management

  • PML is planning to launch 8-10 new products in FY17

  • PML is now exporting products to 95 countries

  • PML is now present in 3000 key hospitals in India and plans to expand to 5000 hospitals in next 2 years

  • Expanded the sales and marketing team with 80 new team members

  • The Indian medical device market is the top 20 in the world and 4th in Asia after Japan, China & South Korea

  • The medical devide sector was valued at USD 6.3 in 2013 and is expected to grow to USD25-30 by 2025

  • PML is the leading exporter of infusion therapy, blood management, gastroenterology, surgery and wound drainage,
    anesthesia and urology products

  • Over 65% of revenues come from exports

  • PML has 144 product and process patents globally; filed for additional 394 patents in India and worlwide

(MHS) #263

Poly Medicure Ltd has informed BSE that a meeting of the Board of Directors of the Company will be held on February 06, 2017, inter alia, to consider the following:

  1. To consider and approve the Un-Audited Financial Results of the Company for the Third quarter and Nine months ended on December 31, 2016.

  2. To consider declaration of 2nd interim dividend, to the Equity Shareholders of the Company for the current financial year 2016-17.

  3. To consider the issue of Bonus Shares, subject to approval of shareholdeis to be obtained in this behalf.


Any news in Budget yesterday regarding medical disposals/devices/companies??


That is a good news. Let us see how much of this turns into reality.

  1. They have been talking about new products, but I am yet to see success in that direction.
  2. They need to focus product differentiation, instead of solely depending price competitiveness.

Used to have the stock in my portfolio and came out around two years ago, I think. Added a tracking position again.

I like the industry. Polymer is one of the few major players in this industry.

(bvr007) #265


Company declared 1:1 bonus along with 1/- Rs per share dividend in todays meet.

(MHS) #266

Q3 Results:


(bvr007) #267

@ayushmit , whats your impression about unexpected bonus ratio of 1:1 and latest result…thanks…!

(Abhishek Basumallick) #268

On February 2, 2017, government notified the new Medical Devices Rules 2017 with an aim to reduce dependence on imported medical technology and give a boost to domestic manufacturing. The new rule and increase in private & public investment in healthcare are expected to provide big opportunities for Indian medical devices players, according to Himanshu Baid, managing director, Poly Medicure Ltd.

Poly Medicure Limited, one of the leading manufacturers of disposable medical devices, manufactures over 100 varieties of devices through its six global manufacturing facilities – four in India and one each in China & Egypt. Infusion therapy is the company’s key product vertical, which contributed to approximately 67 percent of its net
revenue from operations in fiscal 2016. With an aim to further increase its market share and meet the growing demand of medical devices, the company is constructing a greenfield manufacturing facility at Faridabad (Haryana).

In this interview with Rakesh Rao, Himanshu Baid delves into the nuances of medical technology industry and growth plans for the company.

What was the rationale behind setting up greenfield project in Haryana? Are there any plans of product portfolio expansion?

With this Rs 60 crore greenfield project at IMT Faridabad in Haryana, we will significantly broaden our existing manufacturing facilities to tap on new market opportunities. This will enhance our journey to capitalise on the growth opportunities in the medical devices sector and also to expand our product offerings by introducing a slew of products. The project is geared up to commission in third quarter of 2017 with all statutory approvals. Two manufacturing plants, located in Haryana, are in closed vanity of the new project.

Poly Medicure will introduce new products in gastrology, oncology, nephrology and respiratory care. The company is also adding more diethylhexyl-phlthalate (DEHP) & polyvinyl chloride (PVC) free range of products in the portfolio which will provide better patient and healthcare professional safety. With the new R&D center in Faridabad, commissioned in November 2016, we have doubled our current infrastructure for tooling & design. This will help us in creation of new generation of medical devices.

Are there any plans of acquisitions?
Yes, we are looking for suitable acquisitions overseas and in India which will complement our current business.

What is your view on budget 2017-18?

Industry welcomes Medical Devices Rule 2017, notified on February 2, 2017, which will come effect from January 1, 2018. It will attract investment in sector, will reduce cost of the devices. New rules for pricing medical devices should benefit common man. New FDI policy, under consideration, will hopefully boost the investments in healthcare sector.

How do you view the current status of medical technology sector in India?

At present, the global medical technology market is around $ 350 billion, which is expected to grow 5 percent annually for next 5-7 years. The Indian market is among the top twenty in the world by market size, and fourth in Asia after Japan, China & South Korea.

The medical technology sector in India valued at approximately $ 10 billion in 2015 at end consumer prices and is growing at 10-12 percent annually. Currently, the Indian medical devices industry represents just over 2 percent of the global medical device market.

The Indian medical devices industry has huge potential to grow and be among the top 5 medical devices manufacturing hubs globally. It can also significantly contribute to GDP of the country that will result in fulfilling the government’s vision of healthy India.

The current medical device industry is driven by innovation and new technologies. The advent of engineering innovations have led to the recent development of low cost products that are at par with existing products on quality.

Availability of advanced and sophisticated medical technology is creating new markets & applications, increasing the dependence by doctors on advanced medical devices. This is leading to rapid obsolescence of existing medical technology thereby creating demand for replacement & upgradation of products.

What are the key challenges before medical technology sector in India?

Medical technology fraternity remains concerned over some perturbed policy announcements like too many governing bodies with diverse requirements & standards, inclusion of stents in NLEM, and inclusion of medical devices under UPCMP (as medical devices are completely different from pharmaceuticals).

In addition, Ministry of Environment and Forests has put a cap on useful life for refurbished equipment and import of reused equipment. This ministry has also made announcements on phasing out of chlorinated plastic bags, gloves and blood bags within two years. As of now there are no proven alternative to these products.

Some of these issues seriously affect Ease of Doing Business and the investment environment in the industry.

Recently, government brought stents under price control regime. As a player in the medical devices sector, how do you view this development?

This move will restrict flow of new technology in India and will also slow down innovation. Through appropriate mechanism the government should rewards new technology & innovations and reduce gap between ex-factory/import price to end price to the customer.

Medical devices sector is largely import-dependent. How can we change this scenario?

Medical technology, a nascent industry in India, is described by its fragmented nature, large dependence on imports and a complex and inadequate healthcare delivery system in the country. This industry consists of small and medium companies primarily focusing their R&D efforts and manufacturing capabilities for affordable medical devices such as disposables, medical supplies and small equipment - which come under low-price, high-volume market segments. Requirement of high-end medical equipment and consumables are met largely by imports.

The Government of India has identified the medical devices industry as a sunshine sector for the Make in India initiative. Financial incentives like tax holidays should be extended to new manufacturing plants.

Correction in inverted duty structure and tariff reduction on raw materials and inputs will boost domestic manufacturing. Government should work with domestic and global stakeholders to identify positive iincentives and policy measures that will attract investment and innovations. With a wholesome improvement in India’s business
environment, the healthcare services can be made available at lower costs which will hugely benefit people across classes.

The business environment in India needs to be more investors friendly to bring in an adequate amount of investments and solicit robust growth in the manufacturing industry. For the ease of doing business, our regulatory policies needs to be in line with global regulatory practices so that there should be no hold back for medical device companies to
invest and operate in the country.

(Ayush Mittal) #269

Its definitely a positive given the ill-liquidity in the stock. I have been amazed at the wealth creation by this company. Have been hugely wrong in doing profit booking from time to time thinking that the growth has slowed and the stock is expensive. So have now just stopped thinking too much :slight_smile:


(MHS) #270

Any news/updates on Poly Medicure other than the Bonus issue of 1:1.
The stock in running …

(Ayush Mittal) #271

Summary of the recent interview:

We are starting a new plant focused on nephrology. Its the same greenfield project in Haryana. There is a technology transfer from a European company. First to make such products in India. These are basically used in dialysis. All of this is 100% imported as of now. These are not high value but high consumable. Plant should be operational around July/August.
Good update in export markets and we are doing very well. Nothing new.
Update on blood banking - the consumption has almost tripled due to new method of blood transfer.
We are also investing for Oncology field and the same will be launched in 2018.

(Abhishek Basumallick) #272

Q4 and FY17 results:

(bvr007) #273

Thanks for sharing the quarterly comparison, looks like market is punishing the stock after the result announcement, but it isn’t a great opportunity to buy a solid consistent performer with a long term view as new project is about to start around july 2017. have invested earlier and planning to add at lower levels. @ayushmit , basumallick…your thoughts on future road map of the company please…!

(Ayush Mittal) #274

Does this means, the company has got the final approval and there won’t be further litigation?

(Raj Panda) #275

Liked these few snippets, from this latest interview

  1. They have now narrowed down the scope of their patent applications and have freedom to operate in European market. So that i hope is the end of the long 8 year battle with B.Braun.
  2. They were losing credibility in the EU market because of B.Braun suing their distributors etc…
  3. Sales contribution from this product is about 10% of total and out of that about 20% is to Europe.
  4. They plan to do a 50% ramp up in manufacturing capacity for this product.
  5. In addition this could give a good fillip to overall sales in EU because earlier they were missing this key product from the basket and it was difficult to approach customer/hospitals which like to deal with someone with a complete basket of products.

If one looks at this old interview from Mr. Baid given in Sep’14 after winning 2 patent battles. He had spoke about gaining around 6-8% market share in a 200 Mn USD European safety catheter market. Which comes to about 80+ cr. If we see FY17 revenue and assume similar export contribution as FY16 (65%), and EU contribution in exports being 50% as per latest interview, EU revenue comes to 150 cr. Can we say Mr. Baid seems to have not only walked the talk but exceed his own projections ? I don’t have the data on contribution of safety catheter in this 150 odd cr. revenue from EU, so can’t be sure.

On personal front, i have seen Polymed products being used in some top hospitals of Bangalore, so that has kind of increases the confidence, not that i ever doubted the business quality.

Disclosure: I was out of this stock in Dec’14 as disclosed earlier, and bought back recently. Doesn’t seem to be cheap but seems to get to interesting levels given the current development. Not a buy/sell recommendation.

(chets) #276

As per last year’s AR "Extreme volatility of exchange rate of rupee against US dollar can have significant impact on the Company’s operations because approximately 65.57% of its total revenues consist of exports. "

@ayushmit : How do you read the current situation of the strengthening rupee wrt Poly Medicure?

(Ayush Mittal) #277

There could be some impact on margins

(Vamsi Krishna) #278

@ayushmit and @basumallick Market has been punishing the stock of the poor performance especially their operating margins. Do you see any significant gains due to the win of patent battle against Braun coming from Europe?

Disc: Invested since 2013

(Abhishek Basumallick) #279

@Vpayasam sorry, I don’t track it actively any longer. Have sold out some time back.

(MHS) #280

Q2 Results:



(Ayush Mittal) #281

Very good results from the company after a long gap. This has happened several times for this company that things go stagnant for few qtrs and then they again do well and continue to march on. Though the valuations are already very rich and may be discounting lot about future.