| From CMD's Desk :
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Dear Shareholders,
As I review the year gone by, we find ourselves in the midst of
another financial crisis now engulfing the Euro zone. This has
erupted just when things seemed to be settling down and a financial
recovery seemed imminent. Economists & opinion leaders have
cautioned that the recovery may be uneven, conditions for sustained
growth may remain weak and the global imbalances may widen again.
Until there is a complete recovery in the economic situation, the
immediate challenge for policy makers will be to continue the
fiscal stimulus.
It is envisaged, that a strong growth will be observed in
developing countries, especially in Asia and the output growth in
these countries will reach 5.3 per cent this year from 1.9 per cent
last year. As far as the advanced countries are concerned, growth
is predicted to remain stunted. The US economy is expected to grow
by 2.1 per cent and both the European Union and Japan are expected
to grow at a much slower rate. With this pace of recovery, the
major developed economies are not expected to provide a strong
impulse to global growth in the near-term outlook. The Indian
Economy will therefore face one of the most challenging times in
its endeavor towards higher growth.
Economic Survey Report (ESR) has predicted the Indian economy to
grow at 8.25 - 8.5 per cent in the year 2010-11 and at 9.00 per
cent in the year 2011-12. The GDP growth projected will largely be
led by the manufacturing sector which is likely to grow at 8.9 per
cent. The educated and young middle class population with high
aspirations will drive the consumption boom within India. This will
infuse substantial investments particularly in the industrial
sector. India would thus bounce back to become one of the world's
fastest growing economies in the next five years. Though the ESR
has projected a highly optimistic picture for growth, price
inflation remains a major cause of concern. The need of the hour
for regulators is therefore to take strong measures to check the
rising inflation to make the growth inclusive for all sections of
the society.
The Indian Pharmaceutical Industry has already been placed among
the top four emerging markets according to the research report
published by IMS Health Inc. The spending on healthcare by an
average Indian household is expected to grow from 7 per cent in
2005 to 13 per cent in 2025. As a highly organized sector, the
domestic India pharma market is likely to reach US$ 20 billion by
2015. Indian domestic pharmaceutical market has grown at a CAGR of
about 13 per cent in the last five years. Around 67 million Indians
are expected to reach the age of 67 years by 2011-12. Statistics
provide enough evidence about the geriatric population spending
large amount on healthcare. This is one of the parameters on which
Pharma Analysts have based their projections about substantial
growth in the domestic pharmaceutical market.
As Indoco looks into the future, there is a sense of contentment
that all the strategic restructuring carried out during the year
gone by has brought the desired results. Indoco achieved total
revenues of Rs. 4023.6 million and PAT of Rs. 420.9 million as
against total revenues of Rs. 3552.6 million and PAT of Rs. 314.4
million last year. I am happy that Indoco has emerged successful
amidst the economic slowdown last year. On the domestic business
front, we have launched two new divisions, Xtend to focus on the
extra urban population and Eterna to target Consulting Physicians.
As far as international markets are concerned, alliances with
Watson Pharmaceuticals, Inc. (3rd largest generic company in USA)
and Aspen Pharmacare Limited (South Africa’s largest pharmaceutical
company) have placed Indoco on a firm footing to launch an
aggressive growth agenda in the international business. This has
strengthened Indoco’s credentials further as a reliable service
provider for development and manufacturing of APIs and Finished
Dosage Forms.
Finally, I take this opportunity to express my gratitude to all our
stakeholders including shareholders, customers, bankers, medical
fraternity and vendors for their continued support. I thank all
Indocoites for their untiring efforts and whole hearted
co-operation.
As always, Indoco team will endeavor to continue to progress in
building a healthier world.
SURESH G KARE
Chairman and Managing Director
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