The Hindu Business Line : Indoco keen on overseas buys — Setting up jt venture in S. Africa

INDOCO Remedies Ltd, a closely held company, is looking to acquire overseas companies with strong product licences and has targeted an expenditure of Rs 50 crore.

"The idea is to look for a company with good licences and use India as a manufacturing site. Our aim is to grow our exports from India," Mr Suresh Kare, Chairman & Managing Director, Indoco Remedies, said.

Indoco has registered a 100 per cent arm in the UK called Indoco Remedies UK, company officials said.

The company is setting up a joint venture in South Africa with Awakash International, a South African company. This joint venture, in which Indoco will hold 55 per cent, is primarily meant for exporting Indoco products in the South African region.

The South African joint venture, Indoco South Africa Pvt Ltd, will be headed by a citizen of that country according to regulations there. The board will comprise two members from Awakash and three from Indoco.

The company plans to take exports, which currently stand at 8.5 per cent, to 50 per cent of the total revenue by 2010.

"We are in talks with generics companies. We already have tie-ups in place with some of the generics companies for exports," Mr Kare said.

"Our expansion plans are pro-active.''

Indoco, which has a strong presence in the acute diseases segment is looking to include lifestyle products in its product mix.

"Eventually, we would like to have lifestyle products contributing 45-50 per cent," Ms Aditi Kare Panandikar, Director-Business Development & HRD, said. She also pointed out that the marketing strategy was shifting from a huge dependence on general practitioners' (GP) prescription to consultants. Between 1998 to 2004, the dependence on GPs has come down from 81 per cent to 52 per cent.

Indoco is currently working on three Euro dossiers and 3 ANDA projects. Indoco Remedies Ltd is expanding its facilities in India. It plans to invest Rs 55 crore to set up two new manufacturing facilities in Mahad in Maharashtra and Baddi in Himachal Pradesh.

The Mahad facility to be set up at a cost of Rs 30 crore will manufacture active pharmaceutical ingredients mainly for exports. The Baddi facility will be set up at investment of Rs 25 crore. This facility will manufacture tablets and ointments for the domestic market.

Additionally, Indoco plans to invest another Rs 15 crore in expansion of its existing Goa facilities.

The company, which follows a July-June schedule, ended the year with a profit after tax of Rs 21.27 crore (Rs 14.05 crore) on sales of Rs 177.66 crore (Rs 146.62 crore).

The company is not unduly worried about patenting regime. "At any given time, not more than 12 per cent of the products are patented," Mr Kare said.

More Stories on : Mergers & Acquisitions | Pharmaceuticals

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