 "Serum Institute")
Pandemic-led changes in the global and domestic economy have yielded big gains for corporations across many sectors.
Pune-based vaccine maker Serum Institute of India (SII) seems to be one of the biggest gainers among them. The global surge in demand for its Covishield vaccine, a prophylactic for Covid-19, led to a big spike in SII’s revenues and profits in the last two years.
The company’s revenues more than tripled in FY22 over the previous year and it became the most profitable unlisted company and the most profitable pharma maker in the country by a big margin.
The company’s net profit was up 186 per cent YoY to Rs 11,116 crore in FY22, higher than any other pharma firm in the country. In comparison, Zydus Lifesciences was at number two in the league table with a net profit of Rs 4,487 crore in FY22, followed by Sun Pharmaceuticals at Rs 3,272.7 crore. Similarly, SII’s net sales were up 256 per cent YoY to Rs 25,645 crore in FY22, putting it in second place, behind Sun Pharmaceuticals, which reported Rs 38,654 crore.
FY21 too was financially rewarding for SII — the year when India and the rest of the world suffered the first wave of the pandemic. The company’s net sales were up 32.2 per cent YoY while its net profit increased 48.1 per cent.
In all, SII’s net sales are up nearly five times since the outbreak of the pandemic — from Rs 5,446 crore in FY20 to Rs 25,645 crore in FY22. In the same period, its net profit was up in equal proportion — from Rs 2,251 crore in FY20 to Rs 11,116 crore in FY22.
In contrast, in five years from FY15 to FY20, SII’s net sales had clocked a compound annual growth rate (CAGR) of 7.8 per cent, from Rs 3,737 crore in FY15 to Rs 5,446 crore in FY20. In the same period, its net profit had grown at a CAGR of just 2.8 per cent from Rs 1,964 crore in FY15 to Rs 2,251 crore in FY20. SII is the world’s largest vaccine manufacturer by the number of doses produced and sold globally. The company is the prime manufacturer of the Covid-19 vaccine developed by Anglo-Swedish pharma major AstraZeneca Plc.
However, unlike in the past, SII’s top line growth in FY21 and FY22 was driven by sales in the domestic market rather than exports. In fact, for the first time in FY22 sales in the domestic market accounted for the majority of its revenues. Exports accounted for only around a fifth (19.7 per cent) of SII’s revenues in FY22, down from 77.7 per cent in FY20 and the 10-year average of around 75 per cent.
The company clocked export revenues worth Rs 5,063 crore in FY22, up 14 per cent from Rs 4,414 crore in FY21 and Rs 4,230 crore in FY21. In comparison, SII’s revenue expenses in forex or imports were up 145 per cent YoY to Rs 3,630 crore in FY22 from Rs 1,483 crore a year ago and Rs 839 crore in FY20.
The combined net sales of 274 listed and unlisted pharma companies whose FY22 finances are available were up 15.8 per cent in FY22 to Rs 4.55 trillion and increased 28.5 per cent cumulatively since FY20, according to the data from Capitaline database.
In the same period, the industry’s combined net profit was up 9.7 per cent YoY to Rs 63,674.5 crore in FY22 and cumulatively up 74 per cent since FY20.
