ASKA
CAPITAL PVT LTD
ABOUT US
Aska Capital is a niche management consulting firm, primarily focusing on the pharmaceutical sector.
Founded & led by Mr. Sisir Kumar Appikatla, the firm possesses a unique combination of the energy and drive of a start-up coupled with a team of ownership-oriented domain experts with wide-ranging experience across the pharmaceutical value chain.
Our mission is to partner with corporates, fund managers, and investors in the acquisition of either entire pharmaceutical companies or their select business units which have excellent growth prospects and scale them up to their fullest potential, creating value for all stakeholders.
We also provide innovative solutions to corporates and investors in the pharmaceutical sector by way of transaction advisory, M&A, equity and debt capital-raising, and other allied management consulting services.
The ASKA WAY
LANDSCAPE
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The Pharma Value Chain:
As depicted in Fig. 1., raw material producers at the bottom of the pyramid have thin margins and little or no scope for margin expansion, while those at the top enjoy higher margins and
pricing power.
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Aska View:
At Aska Capital, we concentrate on the upper tier of the pyramid, focusing on companies that exhibit strong growth, demonstrated profitability, and have the potential to be scaled up. Such companies are usually found in the branded formulations space.
MARKET & INDUSTRY POTENTIAL
Global Health Care Market
Indian Health Care Market The global healthcare market size was valued at USD 8.45 trillion in 2020 and is expected to reach USD 11.98 trillion by 2027, growing at a compound annual growth rate (CAGR) of 5.5% from 2020 to 2027.
The global pharmaceutical market size was approximately valued at USD 1.27 trillion in 2020, and was projected to grow at a CAGR of 3-6% through 2025 (IQVIA).
Indian Health Care Market
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Healthcare is an integral part of a growing economy like India, with broad indications that healthcare as a percentage of India’s GDP may go up as the country progresses over the next few decades.
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The Indian healthcare market size was estimated to be worth USD 372 billion by 2022, with a projected CAGR of 17% (IBEF).
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The pharmaceutical sector is a significant contributor to the Indian healthcare market, worth approximately USD 41.1 billion in 2020 and accounted for the majority of the market share.
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The Indian pharmaceutical industry is the third-largest in the world by volume and the 11th largest in terms of value globally (IQVIA).
OPPORTUNITY
The Indian pharmaceutical industry has grown 10 times in the last 2 decades, growing from US$ 4.2 billion in the year 2000 to US$ 41.1 billion in 2020.
Recent M&A activity in 2021 and 2022 indicates that large and mid-sized Indian companies are acquiring existing divisions of smaller Indian companies as well as those of foreign companies to get direct access to an established product domain in specific therapeutic segments.
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Acquisition of a 33.38% stake in Unichem Laboratories Limited by Ipca Laboratories Limited for INR 1034.06 crores on 24th April 2023.
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Acquisition of a 54% stake in J.B. Chemicals and Pharmaceuticals by KKR in 2020 for about INR 3,100 crores
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Dr. Reddy’s acquisition of select business divisions of Wockhardt
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Cipla's acquisition of the brands Vysov and Vysov M from Novartis AG for India
Overall in the Pharma sector Branded Formulations Businesses have traditionally enjoyed:
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consistent growth over a long period of time,
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high return ratios,
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the ability to consistently hike prices annually by 4-5%,
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an asset light model
and certain other key factors, all of which have combined to provide the scope for operating leverage and strong free cash flow generation.