Sector Update | 11 April 2021
Sector Update| Healthcare
Healthcare
Performance of top companies:
Mar’21
MAT
Mar’21
Company
growth
(%)
(%)
IPM
2.1
10.3
Wockhardt
-9.6
35.9
Emcure
8.5
32.6
Glenmark
15.2
23.2
Biocon
-2.1
20.1
FDC
-1.5
18.5
Merck
19.0
17.1
Ajanta
9.6
16.8
Alkem
1.5
16.8
Zydus
3.7
15.5
Cipla
7.5
14.3
Ipca
11.1
13.8
Intas
4.0
13.4
Dr. Reddy’s
0.1
12.6
Abbott
5.2
11.6
GSK
-5.7
9.1
Pfizer
4.9
7.8
Sun Pharma
2.7
6.9
Indoco
-5.1
5.9
Torrent
4.1
3.9
Lupin
1.9
3.8
Eris Ls
6.3
3.4
Mankind
2.9
3.1
Sanofi India
2.6
2.8
JB Chemicals
12.1
1.5
USV
6.9
0.9
Alembic
-1.5
-4.1
MSD Pharma.
-3.9
-8.9
Astrazeneca
-2.9
-10.0
Natco
-23.5
-37.5
IPM sees a sharp spike in YoY growth in Mar’21 led by COVID-19 drugs
IPM grew 10.3% YoY in Mar’21 v/s 1.1% in Feb’21 and 8.9% in Mar’20.
VMNs/Gastro/Pain therapies exhibited a growth of 22.2%/21.6%/14.6% YoY.
Anti-Infectives Therapy recovered, with 8.5% YoY growth compared to an 11%
decline in Feb’21. Strong growth in these therapies is partly on account of higher
offtake of COVID-19 related medicines on a YoY basis.
Respiratory sales are on a downtrend, with a 15.1% YoY decline in Mar’21 as well.
NLEM/non-NLEM (~17%/~83% of IPM) grew 4.3%/11.6% YoY.
On a MAT basis, IPM growth stood at 2.1% YoY.
For the quarter-ending Mar’21, YoY growth was 5.3%. Price/NP growth of
5%/2.7% was offset to some extent by a YoY dip of 2.4% in volumes.
For the quarter-ending Mar’21, NLEM/non-NLEM (~17%/~83% of IPM) grew
0.7%/6.3% YoY.
In Mar’21, Emcure Pharmaceuticals (+32.6% YoY), Glenmark Pharmaceuticals
(+23.2% YoY), Biocon (+20.1% YoY), and FDC (+18.5% YoY) delivered a robust
performance.
COVID-19 related medicines like VMNs in the case of Emcure/Alkem
Laboratories/Sun Pharmaceutical Industries, Favipiravir in the case of Glenmark,
and Remedesivir in the case of Cadila Healthcare/Cipla have partly aided growth
in respective companies.
Biocon’s growth was driven by Anti-Neoplastic/Anti-Infectives (+91.6%/80.8%
YoY). Ajanta Pharma’s growth was led by Pain/Ophthalmology/Dermatology
therapies (26.2% YoY/22.8% YoY/21.7% YoY). Ipca Laboratories posted good
traction in Pain/Analgesics (+39% YoY) and Gastro (36% YoY) segments.
GlaxoSmithKline Pharmaceuticals, Torrent Pharmaceuticals, Lupin, and Alembic
Pharmaceuticals posted lower than industry growth in Mar’21
(9.1%/3.9%/3.8%/-4.1%) on a YoY basis.
On a MAT basis, JB Chemicals & Pharmaceuticals/Merck India/Torrent reported
the highest price growth (+9.7%/7.6%/6.8% YoY).
Chronic therapies saw strong growth with Cardiac/VMN/Anti-Diabetic grew
11.2%/8.1%/5.5% YoY.
Respiratory/Anti-Infectives/Pain therapy sales declined 8.7%/4.7%/2.7% YoY
impacting overall growth.
Price Growth (%)
New Product Growth (%)
9.8
5.4
2.7
1.7
4.5
1.4
2.9
1
-1.9
-6.5
-2.4
4.6
6.4
4.9
3.4
5.3
5.0
2.7
Total Growth (%)
Price/NP growth offsets volume decline for the quarter-ending Mar’21
Emcure, Glenmark, Biocon, and FDC were the outperformers in Mar’21
Cardiac, VMN, and Anti-Diabetic drive overall sales growth on a MAT basis
Exhibit 1: Prices and NP grow while volumes decline in the quarter-ending Mar’21
Volume Growth (%)
9.5
4.9
3.4
1.2
11.5
8.0
5.2
2.9
-0.1
5.5
3.2
2.8
1.1
9.1
5.3
2.7
-5.9
3M-Mar 19
3M-Jun 19
3M-Sep 19
3M-Dec 19
3M-Mar 20
-11.8
3M-Jun 20
3M-Sep 20
3M-Dec 20
3M-Mar 21
Source: AIOCD, MOFSL
Tushar Manudhane – Research analyst
(Tushar.Manudhane@MotilalOswal.com)
Bharat Hegde, CFA – Research analyst
(Bharat.Hegde@MotilalOswal.com);
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.