The Indian Pharmaceutical Industry

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Introduction The Indian Pharmaceutical Industry is in the front rank of India’s science based industries. It is a highly organized sector. The Industry is estimated to be of worth $ 4.5 billion, with growth of about 8 to 9% annually. It ranks very high in terms of technology, quality and range of manufactured medicines. From simple headache pills to heavy antibiotics and complex cardiac compounds, almost each and every type of medicine is now made indigenously. It meets around 70% of the country's demand for bulk drugs, drug intermediates, tablets, chemicals, capsules, pharmaceutical formulations orals and injectable. There are 250 large units and 8000 Small Scale Units, which forms the core of the Indian pharmaceutical industry (including 5 Central Public Sector Units). Indian Pharmaceutical industry in 2012 – 2014 Increasing sales of generic medicines, growth in chronic therapies and greater penetration in rural markets are reasons behind a double-digit growth i.e. 13-14% in 2013. The year 2012 closed with growth of 12%. It attracted FDI worth 9,776 million USD between April 2000 to November 2012. India's exports of drugs and pharmaceuticals grew by 27% to Rs 60,000 crore (11.19 billion USD) for the year ended March 2012. This industry is projected to show double-digit growth in future owing a rise in pharmaceutical outsourcing and rising investments by multinational companies. Most of the companies in this sector have shown considerable decline in growth in the first half of 2011. Companies like Cipla, Torrent and IPCA which focused on Indian market are already in trouble. Growth rates of companies such as Dr. Reddy and Ranbaxy have come down. On the other hand Sun and Lupin are showing growth because to the shift of fo... ... middle of paper ... .... The return on net worth in 2010 was 18.31% to 16.99% in 2013. The dividend payout ratio is maximum in 2011 of 27.23 % . The debt equity ratio has remained very low that is .11 which is far below than the ideal ratio of 2:1. EPS has increased from Rs. 9.99 in 2009 to about Rs 18.77 in 2013 with gradual increase throughout. The DPS for two years has remained constant in 2009 to 2013 of Rs. 2. Book value per share EPS has almost remained same throughout i.e. from around Rs. 5.99 in 2009 it has become Rs. 5.88 in year 2013. (http://www.moneycontrol.com/news/business/indias-pharma-industry-seeing-rapid-growth-wockhardt_1013349.html) CONCLUSION: From the above table and interpretation it can be concluded that CIPLA is under performing decently as the dividend payment is constant and increasing EPS. Thus, Investing in this company is therefore could be a good option.

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