market research report : pharmacy retail market in india 2012

Pharmacy Retail Market - India

March 2012

2PHARMACY RETAIL MARKET – INDIA.PPT

SAMPLE

Executive Summary

Market

Drivers &

Challenges

Competition

� Pharmacy Retail market in India was valued INR x.x mn in 20-- and is expected to reach

INR y.y mn by 20--

� The market is highly competitive due to low entry barrier

� There are numerous players in the market operating in different parts of our country

Drivers:– Growth in pharmaceuticals sector

– Increase in healthcare spending

– Changing disease profile

– Growth in OTC segment

– Consumer attitude

– Attractive margins

Challenges:– Fragmented industry

– Long distribution and supply chain

– Counterfeit drugs

Trends

Government Role

� License procurement

� Ownership Restrictions

� Loyalty Schemes

� Value Added Services

� Tracking of Counterfeit Drugs

� Tele Consultation Service

� Government entry in Pharmacy Retail

� Organized retailers starting pharmacy chains

� Entry of private labels

� Rural area expansion

� Health Insurance Plans made available in Pharmacy

outlets

Emerging Trends

� Customer Relationship Management (CRM)

� Enterprise Resource Planning (ERP)

� Supply Chain Management (SCM)

Technology Trends

� Foreign Direct Investment

� Drugs & Cosmetics Act 1940

� Pharmacy A leads in the organized pharma retail market with highest number of outlets

� Other leading organized players include Pharmacy B., Pharmacy C, Pharmacy D, Pharmacy E, Pharmacy F,

Pharmacy G, Pharmacy H, Pharmacy I, Pharmacy J, Pharmacy K


SAMPLE •Introduction

•Market Overview

•Drivers & Challenges

•Emerging Trends

•Technology Trends

•Government Regulations

•Competition

•Strategic Recommendation

•Appendix


SAMPLE

Pharmacy Retail serves direct consumer requirements

Pharmacy Retail deals with the selling of drugs directly for consumption purpose

The concept is also known as Community Pharmacy

Source:

Pharmacy Retail

Growing Importance of Pharmacy Retail in India

Dispensing prescription medicine to the customers

Checking dosage and ensuring that medicines are correctly and safely supplied and labeled (pharmacist are legally

responsible for any dispensing errors)

Liaisoning with doctors about prescriptions

Selling over the counter medicines

Counseling and advising the Customers on the treatment of minor ailments

Advising customers of any adverse side effects of medicines or potential interactions with other medicines/

treatments

Overseeing the ordering and safe storage of medical products

Keeping up to date with current pharmacy practice, new drugs and their uses

Maintain computerized records

Managing, supervising and training pharmacy support staff

Promoting sales and developing the business

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SAMPLE

Unorganized segment of pharmaceutical market dominates

a large volume of the pharmaceutical retail market

• Indian Drug Retail Market is currently worth INR xx.xand is currently growing at a rate of m% per annum

� The retail pharmacy market is ranked nth in terms of value and pth in terms of volume

� There are approximately x stores across the country

• The pharmacy sector on the whole contributes a share of a-b% to India’s GDP

• The market is distinctly fragmented into organized and unorganized players

� The unorganized channel dominates the retail pharmaceutical market commanding as high as z1% of the market share while roughly z2% is captured by the organized players

� Organized retail pharmacy is on a high growth path progressing at a rate of approximately z3% per annum

• The unorganized market is currently valued at approximately INR xx.x occupying m1% of the total market size while organized segment is valued at approximately INR yy.y making up m2% of the remaining

• In India, pharmacies are the dominant distribution channel generating A% of the overall pharmaceutical sales

• Currently, approximately 91% of drug sales is through the retailmarkets, while institutional sales are as low as 9%

Source:

Market Overview

0

500

1,000

1,500

INR bn

18.5%

2016e

G

2015e

F

2014e

E

2013e

D

2012e

C

2011

B

2010

A

Market Size and Growth

Market Segmentation

In %

100%

80%

60%

40%

20%

0%

100%

2016

A7%

B7%

2015

A6%

B6%

2014

A5%

B5%

2013

A4%

B4%

2012

A3%

B3%

2011

A2%

B2%

2010

A1%

B1%

UnorganizedOrganized


SAMPLE

Drivers & Challenges

Changing disease profile

Consumer attitude

Growth in OTC segment

Attractive margins

Drivers

Growth in pharmaceuticals sector

Increase in healthcare spending Fragmented industry

Long distribution and supply chain

Challenges

Counterfeit drugs


SAMPLE

Emerging Trends

`Trends

Loyalty Schemes

Value Added Services

Tracking of Counterfeit Drug

Tele Consultation Service

Entry of Government in Pharmacy Retailing

Organized Retailers Starting Pharmacy Chains

Entry of Private Labels

Rural Expansion

Health Insurance Plans made available in Pharmacy outlets


SAMPLE

Technology Trends: Summary

Technology

Trends

Customer Relationship

Management

Supply Chain

Management

Enterprise Resource

Planning


SAMPLE

Government Role: Summary

Role

of

Government

Licence Procurement

Foreign Direct

InvestmentOwnership Restrictions


SAMPLE

Major Private Companies - Summary

P

Q

R

PAT

1,000

0

-1,000

-2,000

-3,000

-4,000

-5,000

-6,000

-7,000

-8,000

-9,000

-10,000

-11,000 Revenue

3,500,0003,000,0002,500,0002,000,0001,500,0001,000,000500,0000-500,000

Size of the Bubble represents Total Assets

in INR XX

PQR


SAMPLE

Public: Domestic Company – P Company (1/4)

Key People

Products and Services

Company Information Offices and Centres – India

NNNStock Exchange

Corporate Address49, X Road

Bangalore

Tel No. +91 xx xxxxx xxxxx

Fax No. +91 xx xxxxx xxxxx

Website www.ppp.com

Year of Incorporation 19--

Ticker Symbol xxxxxx

Category Products/Services

PharmacyNutritional supplements, life saving

drugs

Products Personal careName Designation

Person M Founder

Person N CFO

Person O Head

Person Q President

City A City BProducts and Services

Head Office

Regional Offices

City C

Source:


SAMPLE Township G, Township H, City IState 3

City D, Township E, Township FState 2

City A, City B, City CState 1

Cities/ TownshipsState

Pharmacy Retail Outlet Locations


Source:


SAMPLE

Source:

Key Ratios

Financial Summary


• The company incurred a net loss of INR xx mn in FY 20--, as

compared to net profit of INR yy mn in FY 20--

• The company reported total income of INR xx bn in FY 20--,

registering an increase of yy per cent over FY 20--

• The company earned an operating margin of x per cent in FY 20-- a

decrease of y percentage points over FY 20--

• The company reported debt to equity ratio of x in FY 20--, an

increase of y per cent over FY 20--

Financial Summary

Profit / Loss

Revenue

0

-m

Revenue

INR mn

Profit

INR mn

p

n

t

s

r

q

0

20--

t

p

20--

s

o

20--

r

n

20--

q

m

Indicators Present Value

Market Capitalization (INR) X mn

Total Enterprise Value (INR) Y mn

EPS (INR) Z mn

PE Ratio (Absolute) A

Particulars y-o-y change 20-- 20-- 20-- 20--

Profitability Ratios

Operating Margin

Net Margin

Profit Before Tax Margin

Return on Equity

Return on Capital Employed

Return on Working Capital

Return on Assets

Return on Fixed Assets

Cost Ratios

Operating costs (% of Sales)

Administration costs (% of

Sales)

Interest costs (% of Sales)

Liquidity Ratios

Current Ratio

Cash Ratio

Leverage Ratios

Debt to Equity Ratio

Debt to Capital Ratio

Interest Coverage Ratio

Efficiency Ratios

Fixed Asset Turnover

Asset Turnover

Current Asset Turnover

Working Capital Turnover

Capital Employed Turnover

Improved Decline

Financial Snapshot


SAMPLE


y

x

20--

z y

x

20--

z y

x

20--

zy

x

20--

z

onm

Key Business Segments

20--

z

y

x

20--

z

y

x

20--

z

y

x

20--

z

y

x

x y z

Key Geographic Segments

Source:

Key Recent Developments

• Operates as a subsidiary of Company A

• Has tie up with M and NOverview

Description News

Pharmacy Retail

• Serves huge number of customers through their pharmacy chain

• Operates in X states inclusive of Y with m number of outlets

• Organizes free health camps and gives free health insurance

• Store formats include shop in shops, hospitals and high street stores


SAMPLE

Appendix

Ratio Calculations

Operating Margin(Operating Income/Revenues)*100

Net Margin (Net Profit / Revenues) *100

Profit Before Tax Margin(Income Before Tax / Revenues *100

Return on Equity (ROE) (Net Income / Shareholders Equity)*100

Return on Capital (ROCE) EBIT / (Total Assets – Current Liabilities)*100

Return on Working Capital(Net Income / Working Capital) *100

Return on Assets (Net Income / Total Assets)*100

Return on Fixed Assets (Net Income / Fixed Assets) *100

Operating Costs (% of Sales)(Operating Expenses / Sales) *100

Administration Costs (% of Sales)

(Administrative Expenses / Sales) *100

Interest Costs (% of Sales) (Interest Expenses / Sales) *100

Ratio Calculations

Current RatioCurrent Assets / Current

Liabilities

Cash Ratio

{(Cash & Bank Balance +

Marketable Securities) / Current

Liabilities)}

Debt to Equity Total Liabilities / Shareholders

Equity

Debt to Capital Ratio{Total Debt / (Shareholders

Equity + Total Debt)}

Interest Coverage Ratio EBIT / Interest Expense

Fixed Asset Turnover Sales / Fixed Assets

Asset Turnover Sales / Total Assets

Current Asset Turnover Sales / Current Assets

Working Capital Turnover Sales / Working Capital

Capital Employed Turnover Sales / Shareholders Equity


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market research report : pharmacy retail market in india 2012

Health & Medicine

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