CARE BENZORGANICS PVT LTD COMPANY SUMMARY Company was founded in the year 2001 and deals in marketing of pharmaceutical products by own brand names with registered trade marks. Presently operating in four states- Andhra Pradesh; Maharashtra; Odisha & Rajasthan. Current revenue Rs 18 lakh per month. Plans to expand operations in ten states with product range in anti-diabetic segment. Indian pharma market is estimated at Rs 79500cr & growing @ 7s% per annum; in terms of volume- the third largest in the world after USA & Japan. FOUNDERS DETAILS S.G.Kulkarni (Msc-tech chemistry) - DIRECTOR – FOUNDER SHARE HOLDING – 25% After completing post-graduation from JNTU Hyderabad (1996) started career in sales with Systopic laboratories & then Lupin labs till yr 2000 & thereafter embarked upon his journey as an entrepreneur by founding this company. Successfully launched the company in Andhra Pradesh in the yr 2001; Maharashtra in yr 2011; Rajasthan in yr 2014 & presently overlooking sales in these states yielding good revenue flow. Responsible for product management i.e. Brand positioning ; Branding ; product portfolio management; product training etc. Now has set a vision for the company to aim for Pan-India operations with new product range in anti-diabetic segmentpresently estimated at Rs 5000cr and growing @ 22% per annum. FOUNDERS DETAILS Manas Ranjan Sahu (Bsc MPC)- DIRECTOR – FOUNDER SHARE HOLDING – 25% After completion of graduation (1996) started his carrier in sales with Emcure Pharmaceuticals and then Lupin Labs till year 2000 thereafter co-founded this Company to embark on his journey to entrepreneur ship. Successfully launched the company in Andhra Pradesh in the year 2001 and Odisha in 2012 generating continuous revenue base. The capability to spontaneously make friends and connect with people helps in building good rapport with customers employees etc, and can go a great length in building a great team imperatively required for pan India expansion. FOUNDERS DETAILS T.K.Shankar rao (Bsc MPC)-Founder member SHARE HOLDING – 25% Served as one of the director in the company since the inception till march 2013 & resigned from service due to health issues. At present serving the company as GM admin to assist in business expansion process. FOUNDERS DETAILS C.Narendra Babu (BA & diploma in Marketing ) Founder Member. SHARE HOLDING – 25% Served as one of the director . Resigned as director in march 2011 due to personal reasons. Presently serving in the company as in charge for Rayalseema region since April 2014 & plans to expand operations in south India. MARKET OPPORTUNITY SEGMENTS PRESENT SIZE & GROWTH RATE INDIAN PHARMA MARKET Rs 79500 Cr - 7% per annum ANTI - INFECTIVE Rs 10000 Cr - 20% per annum ANALGESIC Rs 3000 Cr - 20% per annum CALCIUM + CALCITRIOL Rs 6000 Cr - 11.7% per annum PPI ( ANTI – ULCERANT ) Rs 1000 Cr ANTI – DIABETIC Rs 5000 Cr - 11% per annum - 14% per annum Present product Range PRODUCT NAME COMPOSITION SEGMENT SERRATIOPEPTIDASE ANTI-INFLAMMATORYANALGESIC RESOLVE® – D(TABLET) SERRATIOPEPTIDASE + DICLOFENAC SODIUM ANTI-INFLAMMATORYANALGESIC RESOLVE® –AP(TABLET) SERRATIOPEPTIDASE +ACECLOFENAC +PARACETAMOL ANTIINFLAMMATORYANALGESIC OSIPHILE® CALCIUM + CALCITRIOL CALCIUM SUPPLEMENT ANALOG™ –P (TABLET) TRAMADOL + PARACETAMOL ANTI-INFLAMMATORYANALGESIC CF3-O ™ CEFUROXIME AXETIL ANTI INFECTIVE RESOLVE® (TABLET) (TABLET) ( TABLET) Present Product Range PRODUCT NAME COMPOSITION SEGMENT FEREAL ™ (TABLET) FERROUS ASCORBATE + HAEMATINIC FOLIC ACID HAVITAL® (TABLET) MULTIVITAMIN + ANTIOXIDANT+MULTI MINERALS RABESTIME™ (TABLET) RABESTIME-DSR (CAP) CISCAP ™ RABEPRAZOLE +DOMPERIDONE (CAPSULE) AYURVEDIC (CISSUS QUADRANGULARIS LINN EXTRACT) SUPPLEMENT PPI (ANTI – ULCERANT) ORTHOPAEDIC – ENHANCES FRACTURE HEALING PROCESS. NEW LAUNCHES - 2014 PRODUCT NAME COMPOSITION SEGMENT RELAXID-MR 4 ACECLOFENAC+THIOC OLCHICOSIDE4mg+PARACETAMOL NEW GENERATION MUSCLE RELAXANT ORTHOPAEDIC RELAXID-MR 8 ACECLOFENAC+THIOC OLCHICOSIDE8mg+PARACETAMOL NEW GENERATION MUSCLE RELAXANT ORTHOPAEDIC HAVITAL PLUS ALPHA LIPOIC ACID+METHYLCOBALA MINE+PYRIDOXINE+FO LIC ACID IN DIABETIC NEUROPATHY- ANTI DIABETIC SEGMENT Revenues for previous 4 years YEAR TURNOVER PROFIT BEFORE TAX Yr 2013 - 2014 Rs 16250659.00 Rs1235000.00 Yr 2012 - 2013 Rs 14254328.00 Rs 941933.00 Yr 2011 - 2012 Rs 11175978.00 Rs 715962.00 Yr 2010 - 2011 Rs 10992118.00 Rs 731736.00 Year V/S Revenues in Cr. 1.8 1.6 1.4 1.2 1 0.8 0.6 0.4 0.2 0 2010-2011 2011-2012 2012-2013 2013-2014 Competitive Landscape Indian pharma market is a highly fragmented market but very huge in size & the third largest in the World estimated at Rs 79500cr. Presently there are 24 thousand companies in this industry marketing generic products with none of them having any patent product. Top 10 companies hold almost 33% market share. The competition commission of India denies the monopoly product to any company keeping in view the demographic conditions in India & the Supreme courts verdict against novartis is a case in point. Competitive Landscape In pharma industry products are endorsed by the doctors. Products therapeutic efficacy & good personal relations with the customers plays a dominant role to gain their loyalty towards the company. Participation in Continuous medical education (CME) conferences is yet another key factor to keep them engage with the company. Our growth rate is the prima-facie evidence to the claim that as a company we have gained this niche. Business proliferation pattern with Anti – Diabetic range The greatest advantage in operating with anti –diabetic range is that the end consumer .i.e. patient stays with the brand once his/ her blood glucose level is stabilized .The brand becomes the part of his/ her life. Assuming that a Diabetologist or physician stabilizes 15 new patients per month on our brand & our target shall be to have at least 5 such loyal doctors in each territory. Company plans to operate in 64 territories with 64 sales executives across 10 states post investment. Business proliferation pattern with Anti – Diabetic range According to this assumption a doctor stabilizes 15 patients per month on our brand each patient consuming 3 strips per month ;with 5 such doctors in each territory & 64 territories under operation; assuming Rs 38 per strip as price to stockiest ; the number of end consumers at the end of first year; second & third year & the stable revenue base would be as shown below. First year-end - consumer base - 57600 patients. revenue base - Rs 6566 400 per month. Business proliferation pattern with Anti – Diabetic range Second year-end – consumer base – 115200 patients revenue base - Rs 1.31 Cr per month Third year-end - consumer base -172800 patients revenue base – Rs 1.96 Cr per month. The above mentioned revenue base is for anti-diabetic product range & revenues from existing product range would be an additive factor. Financial Projections in Cr. FIRST YEAR SECOND YEAR THIRD YEAR REVENUE Rs 8.16 Cr Rs 15.12 Cr Rs 24.04 Cr GROSS MARGIN Rs 5.71 Cr Rs 10.58 Cr Rs 16.82 Cr WORKING CAPITAL Rs 6.932Cr Rs 11.97 Cr Rs 18.48 Cr EBIDTA Rs 1.227 Cr – 15% Rs 3.04 Cr – 20% Rs 5.55 Cr -23% Working capital requirement Expenses Heads Amount in rupees per annum Salaries expenses Rs 13260000.00 Production cost Rs 24480000.00 Business promotion Rs 16320000.00 Directors x 2 Rs 4800000.00 Administration & sundry expenses Rs 7200000.00 Total working capital requirement Rs 69324000.00 ( 6.93 Cr). COMPANY VALUATION Company valuation: With reference to the deals happening in pharma industry usually companies are valued based on 5 to 10 times of their annual revenues. Valuation is on the higher side for the companies having products in the chronic segment e.g. antidiabetic ,anti- hypertensive etc. Our focus shall be on anti-diabetic segment. Our expected valuation shall be between 6 to 9 times of our annual revenues after 5 yrs from the date of investment. EXIT OPTION The descent exit shall arrive after fifth year by this time our annual revenues should be in the range of 40 to 50 crores. This should be the ideal time for second round of investment the proceeds to be invested for state of art manufacturing facility-backward integration. Assuming our companys valuation to a bear minimum of 6 times of revenues the valuation should arrive at a minimum of 250cr through private equity route or a VC with a greater investment appitite. Come Invest in Care Benzorganics and Become part of a great Growth Story.