UNICHEM LABORATORIES LTD.

UNICHEM LABORATORIES BSE SCRIP CODE 506690

UNICHEM Laboratories is one of the leading Pharmaceutical companies in India. Unichem is headquartered in Mumbai with five manufacturing locations in Roha (Maharashtra), Goa, Ghaziabad (Uttar Pradesh), Pithampur (Madhya Pradesh) and Baddi (Himachal Pradesh). The Company's facilities enjoy credible certifications: for instance, the Goa plant has been approved by UK MHRA (earlier MCA), MCC (South Africa), WHO (Geneva) and TGA (Australia). The Baddi plant has been approved by UK MHRA and MCC (South Africa). The Company has received ISO 9001:2000 for all its plants and corporate office. Similarly the Company has received ISO 14001:2004 certificates for its formulation plants ( Goa, Ghaziabad and Baddi) and Corporate Office at Mumbai.

As a future-focused initiative. Unichem has expanded its Research and Development facility in Jogeshwari (Mumbai) to spearhead research in Novel Drug Delivery Systems (NDDS) and develop non-infringing routes for the manufacture of products directed at the regulated markets. The Company has also funded a collaborative research with the Indian Institute of Sciences, Bangalore. Unichem's growth strategy is fueled and backed by more than 2400 talented and motivated human resources.

Unichem Pharma is the flagship division of Unichem Laboratories. The division has a diverse portfolio of over 25 brands in the day therapy areas of Pain management, Anti infectives, Anti allergics, Digestives and Nutritionals.

The division has attained leadership in key segments of Cephalosporins and Anti-allergics with brands that have been launched in the past 3 to 4 years. Key among these are Sefdin a brand of Cerfdinir and Lezyncet the leading brand by volumes in the Levocetirizine market.In fact many brands of Unichem Pharma feature amonth the top three brands of the respective segment and three of the brands rank among the top 300 in the Indian pharmaceutical industry

Unichem Specialities is the newest addition to Unichem's many divisions in an endeavour to service more and more customers with quality products and services. Launched in January 2006 , Unichem Specialities has a total field force of 250 people all over India. Their core customers are Orthopaedicians , Surgeons , Gastroenterologists , Physicians , Paediatricians and Intensivists and will reach close to 22,500 doctors all over India

A division of Unichem with the motto of advancing life contributes to major share of total business turnover. The division with its 8 brands has a primary focus in areas of Cardiology with a presence in Tranquilisers and Nutritionals.

Unisearch is today known in the industry for its flagship brands like LOSAR, TRIKA, and TG TOR & CLODREL. The brands have created their own records in respective segments to an extent that LOSAR has now become the No 1 Antihypertensive Brand in the entire country.
Every brand of Unisearch is known with its Brand building activities and strong associations like Monarch Butterfly and TRIKA, Diet Exercise & TG TOR and so on.

A specialty division of Unichem with primary focus in areas of Diabetology and Cardiology.

Launched in July 2004 Unisearch CD with an objective to create and establish itself in a big way in Diabetology segment. All the 11 brands in the division promoted by field strength of 160 representatives are in the growing segments in Cardiology as well as Diabetology.

Unisearch CD is already on its way to establish itself in Diabetology with its brand Metride and in Cardiology with emerging brands like Telsar, Teram.

CNS segment is one of the fastest growing & promising markets. Neu Foreva the division that has been launched with a vision to service the growing needs and demands of this segment is a specialty wing of UNICHEM, which is catering to the field of Neurology and Psychiatry
Within a very short span Neu Foreva has aggressively expanded and strengthened it's roots deeper into the Neuropsychiatry market, presently with 16 brands covering a wide array of Antidepressant, Antipsychotic, Antiepileptic, Tranquilizer, Cerebral Activator, Antiplatelet and Neuropathic pain drugs segments the division has marked it's strong identity with SERTA, C-PRAM S, TRIKA SR as among the top brands in their respective markets.

The team of 145 Sales personnel and skilled managerial force is engrossed to reach the division's goals.

Today, Neu foreva promises a larger share to the total UNICHEM turnover with it's well formulated plans and brand launches.

FINANCIALS

The share capital of the company is 18.02 crores made up of about 3.6 crore shares of Rs.5.00 each. About 48 percent of the shares are held by the promoters’ group and 18 percent is institutional holdings. Several mutual funds are having holdings. The company with share capital of Rs.18.02 has Rs.353.21 crores as reserves. The reserves are grossly undervalued since the company is sitting on huge land bank in Bombay city and other places in India.

The company reported a net profit of 90.1 crores in FY – 2006-07 with eps of about 25 crores. Even taking a conservative P.E. ratio of 10 on the past earnings, the share should command a valuation of 250.00 presently. For the half year Sept. 2007-08 the company has clocked in Net profit of over 46 crores and may end up the full year with a profit of 100 crores, commanding an eps of about 28 for the FY 2007-08. Considering all these, the present stock price of around 190 is very cheap. The company’s shares are trading almost at the year’s low and can be accumulated.

Our earning projections

FY 07-08 Net Profit : 100 Crores EPS 27.77
FY 08-09 Net Profit : 120 Crores EPS 33.00
FY 09-10 Net Profit : 150 Crores EPS 41.00

Presently the share should command a valuation of at least 250 going by the forward earnings. Our share price projections are 320 by April 2008, 380 by April 2009 and 450 by 2010.

With the huge reserves, the company may consider issuing bonus shares also. The last bonus was issued in the year 2004.

Presently Pharma Sector is not in favour with the investors. But things will change in the near future.

People with a longer time horizon can safely invest.