I am not sure if my understanding is correct. But there are a lot of stories spoken on the pharma opportunity but nothing really is showing up on the numbers.
1.Got some scattered segmental numbers - FY23 from crisil report, FY15 - company disclosure. Pharma is flat
If pharma is really positively influencing, realisation per polymer processed should improve right, how does one view this?
How do you look at the addressable market of the three drugs that they keep speaking about - Semaglutide, Terixxx, Liraglutide? So, $XXXBn of opportunity would be how many pens. Lastly, Their addressable market would be much small right, because they are working only with Sanofi, What about Novo and Lilly?
Looking at other players in the drug delivery market - they are growing pretty well it seems, where is Shaily lacking?
Hi. I am going to study this in detail and get back. Please confirm what is the data source or sources for the figures and charts you shared in your post. Just to make sure that we both are looking at the same thing.
I agree that in terms of revenue the company has not shown any increase in pharma or healthcare.
Once again, I agree. We are not seeing any meaningful difference in realisation per kg polymer processed.
I am going by what the company has referred to in their latest concall. See the below screenshot. Amit is referring to how this market may grow to half a billion pens a year. But you are right. The company is totally dependent on how big a share of that market does Sanofi get or how much market goes to generic manufacturers who also then use Shaily’s products.
I think they took some time in trying to understand how to organise their business. For example they started the toy business a few years back and are now retreating from it. In the interim they also kept looking for a CEO but have now put that project on hold. They have recently done a capex of 100 crores specifically for Pharma and my guess is that they are now feeling confident of that getting converted to revenue real soon. Otherwise why would they sink so much money into capex which will lie underutilised for the next couple of years. But this is my optimism talking. Let’s wait and see what kind of revenue and profit starts getting generated from the pharma business.
@aadhar.aggarwal@Cuckoo_Invests The main hope pharma division is flat over almost a decade, management has repeatedly missed guidance and now saying pharma will actually break -out. Beyond hope, what is the strategy here for investors?
Tried to decipher and digest all the useful information in the last concall. Due to the great questions, a lot more details on the healthcare business came out in this call - especially regarding the active ongoing accounts, molecules and platforms. Although its not complete, its a good start and I’ve tried to capture the information here.
Healthcare revenue at 107.7 Cr in FY24 (~17% of revenue) up from 57.6 Cr in FY23 (~9% of revenue). The growth in healthcare is 87% and is expected to grow 50-60% in FY25.
In this 107.7 Cr, the difference in standalone and consol. is 28 Cr in topline and 22 Cr in EBITDA. We know that this 28 Cr is all in healthcare business of Shaily UK (platform access fee) which means the standalone entity has a revenue of 80 Cr in healthcare.
We know that standalone entity does contract manufacturing and own IP pens and we know from this concall that the ratio by value is 70:30 or 60:40… lets take it as 65:35 which makes the contract manufactured insulin pen revenue at 52 Cr and own IP pen at 28 Cr (excluding the platform access fee of 28 Cr)
Volume growth in pens to be around ~45% (17 million pens vs 11.5 million pens). This growth is expected to come from Insulin pens as well as GLP-1 pens. Insulin pen growth could be driven by Ypsomed getting out of contract manufacturing which could be Shaily’s gain (and also since insulin pen base is still considerably small as compared to Ypsomed). Since value growth is guided for 50-60%, GLP-1 volume could be bit higher than the Insulin pen volume.
New business wins in last quarter - 2 Sema and 1 Lanreotide
Platforms
Platform
Molecules
Clients
Misc
Maxim
Insulin, GLP-1
Protean
Insulin, Victoza (Lira)
Low-cost platform. Insulin in non-regulated markets. Good scale-up expected here
Axiom
Teriparatide
7
Approval expected by end of year in regulated markets
Neo
Saxenda (Lira)
Toby & Tristan (Auto-injectors)
Wegovy (Sema), Mounjaro/Zepbound (Tirze)
4
Shaily safe lab
Lanreotide
2
Under discussion for adding 2 more.
There’s also ongoing work on on-body injectors with electronics that will be used in Onco and pain management (under development).
Molecules
Molecule
Clients
Misc
Lira (GLP-1)
5-6
Sema (GLP-1)
6
Tirze (GLP-1)
2
Looking at adding fair bit of new clients in NCE-1 filing. Maybe 4-5 total (2-3 more new expected this year then). Supply of clinical batches by Nov this year.
Teri (PTH)
7
Insulin
2
Total
23
12-15 added in last FY in this
Approval expected in US/EU regulated market for Liraglutide and Teriparatide this year (Lira second half and Teri maybe first half but Teri will hit the market by end of year if all goes well). IMO, this could be a huge trigger as it opens up large opportunity size in the long run to work with Novo or Eli Lilly. We also know for certain that there are 4 new accounts in the pipeline (2 for Tirze and 2 in Lanreotide).
