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– Kamal Narang

Mr Malvinder Mohan Singh, CEO and Managing Director, Ranbaxy Laboratories, and Chief Operating Officer, Mr Atul Sobti, addressing a press conference in the Capital on Thursday.

Our Bureau

New Delhi, Oct 18 Ranbaxy continued to reap benefits of foreign exchange gains in the July-September 2007 quarter and registered a 48 per cent growth in consolidated net profit at Rs 207.4 crore (year-on-year).

Without the foreign exchange gains of Rs 45.5 crore, the company’s net profit for the third quarter grew 13 per cent touching Rs 161.9 crore. Ranbaxy has $440 million of foreign currency convertible bonds, which are to be repaid in 2011.

“They can be converted to equity anytime now, which we hope the investors would opt for,” Mr Malvinder Mohan Singh, CEO and Managing Director, said in a press conference here today. In rupee terms, because of hardening of rupee against the dollar, Ranbaxy’s global sales remained almost flat at Rs 1,652 crore for the quarter (Rs 1,640.4 crore).

However, in dollar terms, the company registered 15 per cent growth in global sales touching $406 million for Q3, driven by higher sales growth in emerging markets like India, Ukraine belt, South Africa and Brazil.

Meanwhile, the developed markets registered 12 per cent growth driven by the US and Europe and contributed 39 per cent to total sales. Mr Singh said India has consistently performed well with Ranbaxy retaining its top position in market share.

In Romania, the company claims to have increased market share to 5.76 per cent in August from 5 per cent early this year and in South Africa it has “improved its market share after acquiring Be Tabs”. “In Romania, we have 20 new products pending to be launched,” Mr Atul Sobti, Executive Director and COO said.

Ranbaxy expects to meet its guidance announced earlier this year of 20 per cent sales growth and 16 per cent EBITDA margin. “We are confident of carrying the guidance for the year through in the next three months. I think we have a strong base to build upon for a stronger 2008 performance,” Mr Singh said adding that they would continue to look for strategic alliances and acquisitions.

Through an out-of-court settlement with GlaxoSmithKline for Valtrex (Valacyclovir Hydrochloride tablets), the company hopes to reap benefits by launching the drug in late 2009 with 180 days exclusivity. “The annual revenues for Valacyclovir Hydrochloride tablets are estimated at $1.3 billion and the market is projected to grow at 15-20 per cent annually over the next few years,” Mr Singh said.

On a standalone basis, Ranbaxy reported net profit of Rs 168.1 crore, up 21 per cent and net sales of Rs 1,038 crore (Rs 1,090 crore) for the quarter. Ranbaxy shares closed at Rs 421.85 against previous day’s close of Rs 420.15 on the Bombay stock exchange.

Ranbaxy plans to list its research and development business.

“Our board has taken an in-principle decision to demerge our drug discovery research business into a separate entity,” Mr Singh, said adding that further details would be announced later this year.

Listing the company separately will unlock its value. Ranbaxy spends about $20-25 million on drug discovery every year — these costs would be taken off from Ranbaxy Laboratories’ from next year. Ranbaxy’s intellectual property rights would be transferred to the new entity.

“There is tremendous opportunity given that we have done so much work in drug discovery in the last 10-15 years. We can look for separate alliances for this unit,” he said.

More Stories on : Forex | Pharmaceuticals | Ranbaxy Laboratories Ltd

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