Cipla to roll out nutritional foods business next year

Company to pursue organic growth, with no compulsion to do mega acquisitions; but will continue with JVs abroad

Pharmacy firm Cipla would expand its consumer products business with a foray into nutritional products over the next 12-18 months, company’s global Chief Executive Subhanu Saxena said on Thursday.

“We had an initial pilot with an over-the-counter product Nicotex and that has been successful. We have  now set up a subsidiary and  looking to launch full range of  nutritional products in next 12-18 months,” he stated. Saxena said Cipla's future  growth will largely be organic and  added the company was  not under any compulsion to do mega acquisitions. He added the company would continue with its strategy of developing joint venture partnerships with pharmaceutical firms in other countries.

The respiratory product business remains the focus area for the company and it expects half of the growth to come from existing markets, while the US and Europe will be new growth areas. “We see immense growth opportunities in this business segment in India,” Saxena said. The company is also looking to grow its product portfolio, develop better delivery systems for patients and expand its nasal spray portfolio.

Earlier in the day, Cipla Chairman Y K Hamied told shareholders that the firm has become more active in the US. “We have de-risked business in certain markets and have successfully incorporated subsidiary in Sri Lanka and Morocco and integrated our business in Myanamar, Uganda and Yemen,” Hamied said.

Compared to other large Indian pharma companies Cipla only earns about eight per cent of its revenue from the US market.

Cipla has given a revenue guidance of 20 per cent for FY16 and expects profits to be in line with revenue growth. The company achieved a revenue growth of 11,000 crore the last financial year. Its net profit doubled to  Rs 651 crore in the first quarter FY16 and revenue grew  43 per cent to Rs 3,777 crore.