Novartis India

Reduction in the selling prices of some key products arising out of the notification of the new Drug Price Control Order seems to have had a significant adverse impact on the revenue and operating profits of the company. Matters were further aggravated on account of the depreciating rupee. Consequently, the company ended the quarter with a 47% decline in net profit at Rs.15 crore on a 4% fall in net sales at Rs.218 crore.

Its core business, pharmaceuticals, recorded a 12% decline in sales and the numbers could have been worse but for the other segments which did much better. Its generics business grew 2% while animal health rose 17%. OTC business did much better, recording a growth of 17%. With more one quarter, it seems unlikely that the company will end FY14 on a higher note. For 9MFY14 net profit was at Rs.75 crore and in the current three months, it will have to scale up to at least reach or surpass Rs.120 crore net profit of FY13. Its equity stands at Rs.15.98 crore and reserves is at Rs.884 crore. Debt free MNC, promoters stake is at 75%.