Cohance Lifesciences Ltd · NSE:COHANCE
Cohance Lifesciences — Suven Pharmaceuticals — Q1 FY2025 Earnings Presentation
42 slides from Cohance Lifesciences's earnings presentation, Aug 9, 2024
Slide 1: Suven Pharmaceuticals Ltd. Investor Presentation – Q1 FY25
Suven Pharmaceuticals Ltd. …Towards a Brighter Tomorrow Investor Presentation – Q1 FY25
Slide 2: Safe Harbour
Except for historical information, all of the statements, expectations and assumptions, including expectations and assumptions, contained in this presentation may be forward- looking statements that involve a number of risks and uncertainties. Although Suven Safe attempts to be accurate in making th
Slide 3: Table of Contents
Table of Contents Executive Summary 04 Q1FY25 Operating and Financial Performance 05 Combined Business: Proforma Metrics Q1FY25 09 Combined Business: Key segment wise strategy 12 Strategic Blueprint 19 Sapala Acquisition 21 Merger of Suven Pharmaceuticals with Cohance 23 Lifesciences - update Financ
Slide 4: Executive Summary
Executive Summary Industry : Positive Customer sentiments driven by supply chain de-risk and industry macro tailwinds o Customer sentiment continues to be positive towards India driven by supply chain de-risking and Industry macro. This continues to drive our confidence in the medium to long term gr
Slide 5: Q1FY25 Operating and Financial Performance
Q1FY25 Operating and Financial Performance
Slide 6: Financial overview
Financial overview Q1 FY25 Performance: Q1 FY25 Consolidated Financial Highlights Q1 revenue softness YoY not exactly comparable given the nature of our business, as the shipment schedule is skewed towards 2H, we expect growth from 2H (34%) (27%) (34%) Revenue from operations (YOY) Pharma CDMO (Yo
Slide 7: Q1FY25 Consolidated Financial results
Q1FY25 Consolidated Financial results INR Million Particulars Q1FY25 Q1FY24 Q4 FY24 YoY QoQ • We expect growth from 2HFY25 as we have purchase Revenue from Operations 2,307 3,476 2,529 -33.6% -8.8% orders in sight set for execution in the second half. Material costs / COGS 636 1,013 837 -37.2% -24.0
Slide 8: Q1FY25 Business performance overview
Q1FY25 Business performance overview Consolidated Financials Operational Revenue (INR Million) Adjusted EBITDA (INR Million) Margin (%) Adjusted PAT (INR Million) Margin (%) 3,476 34.7% 48.6% 37.9% 28.1% 2,307 1,688 874 1,206 649 Q1 FY24 Q1 FY25 Q1 FY24 Q1 FY25 Q1 FY24 Q1 FY25 Pharma CDMO (INR Milli
Slide 9: Combined Business: Proforma Metrics Q1FY25
Combined Business: Proforma Metrics Q1FY25
Slide 10: Proforma Merged Entity
Proforma Merged Entity Q1 FY25 Merged Company INR Mn Revenue 2,307 2,520 4,827 Adjusted EBITDA 874 491 1,365 Adjusted EBITDA margin % 37.9% 19.5% 28.3% Adjusted PAT 649 189 838 Adjusted PAT margin % 28.1% 7.5% 17.4% RoCE 24.2% 36.4% 30.5% RoE 15.8% 29.6% 21.1% (Net Debt) / Net Cash to Adj. EBITDAx 2
Slide 11: Proforma Merged Entity - Combined business mix
Proforma Merged Entity - Combined business mix Merged Company Formulations & Others 22% Sales Mix CDMO (Q1FY25) 22% API++ CDMO CDMO API++ 49% 51% 78% 78% Manufacturing Facilities 5 (2) 7 (5) 12 (7) (Regulatory approved) R&D Centers 2 4 6 Capacity ~1,400 kL ~1,400 kL ~2,800 kL Source: Cohance LifeSci
Slide 12: Combined Business: Key segment wise strategy
Combined Business: Key segment wise strategy
Slide 13: Suven: Pharma CDMO a strong growth engine
Suven: Pharma CDMO a strong growth engine Suven’s Phase III pipeline Good pipeline with improving Phase III Phase III molecules Phase III intermediate o Overall active pipeline of 100+ projects across Phase I – III 13 o We have 10 commercial Pharma molecules Phase III pipeline 6 o Our Phase thre
Slide 14: Favorable Industry Macros leading to growth in Small Molecule Pipeline
Favorable Industry Macros leading to growth in Small Molecule Pipeline Small Molecule Pipeline continues to grow on the back of Oncology; Biologics as a % of Pipeline has been stable around 41-45% • The current size of the clinical pipeline has grown to 22,937 projects. • Small Molecules is 52% of t
Slide 15: Small molecules: Increasing proportion of US FDA approvals
Small molecues: Increasing proportion of US FDA approvals US FDA Approvals lean towards small molecules: ~70% of FDA Approvals 2023 and H1-2024 are small molecules Record Number of Approvals in 2023: 55 novel drugs were approved in 2023. This was the second-highest number of approvals in the last 10
Slide 16: Cohance CDMO
Cohance CDMO ADC payload portfolio – progressing well Two commercial product continue to grow strong with the therapy expansion and Growing numbers of ADC candidates entering clinical trials market registrations. ADC entering CTs in each year* New order from recently onboarded customers are prog
Slide 17: Cohance: API ++ on growth Path
Cohance: API ++ on growth Path Downcycle in API++ is behind us – reported 22% YoY growth in Q1 $86+ Bn Total Addressable Market with healthy order book Sustained growth What will accelerate the base growth: Merchant API market revenues*, USD Portfolio is unique and can drive sustained growth Pos
Slide 18: Suven: Spec Chem/ Agri Chem recovery from H2
Suven: Spec Chem/ Agri Chem recovery from H2 Agri Chem / Spec Chem– headwinds continue, expect recovery from H2’FY25 The demand recovery is slower than expected, re-iterate growth expectations of demand recovery from FY25 based on ongoing efforts and industry demand cycle Industry continues to w
Slide 19: Strategic Blueprint
Strategic Blueprint
Slide 20: Strategic Blueprint Key Pillars
Strategic Blueprint Key Pillars Aspiration Be Most admired CDMO, known for delivery, quality and innovation Pharma Spec Chem ADC API++ CDMO CDMO: Rising RFQs and Partnering with large Shaping strong Unique portfolio lateral pipeline – both innovators Business development focused on small and
Slide 21: Sapala Acquisition
Sapala Acquisition
Slide 22: Sapala – Investment thesis
Sapala – Investment thesis Amongst the few CDMOs globally, supplying complex building blocks for Oligonucleotides Establishes Suven as a deep-domain led integrated player with differentiated tech platforms (ADC, Oligo, amongst others) We completed the first phase of Sapala Organics’ Amongst the few
Slide 23: Merger of Suven Pharmaceuticals with Cohance Lifesciences
Merger of Suven Pharmaceuticals with Cohance Lifesciences
Slide 24: Merger – Approval update
Merger – Approval update Received the approvals from the Stock Exchanges and SEBI. Recently, we have submitted our petition to the Hon’ble NCLT, Mumbai bench, and are awaiting the hearing date. Other regulatory approvals, if any to follow Expect the merger proceedings could take another 7- 10
Slide 25: Financial Performance Q1FY25
Financial Performance Q1FY25
Slide 26: Suven P&L – Adjusted EBITDA margins at 38%
Suven P&L – Adjusted EBITDA margins at 38% INR million CAGR YoY Consolidated P&L Snapshot FY20 FY21 FY22 FY23 FY24 Q1FY24 Q1 FY25 FY20-FY24 Q1FY25 Revenue 8,338 10,097 13,202 13,403 10,514 3,476 2,307 6.0% -33.6% Revenue softness in Q1 on YoY basis, given the lumpy nature of COGS (2,292) (3,019) (3,
Slide 27: Suven Balance Sheet – Healthy cash rich B/S
Suven Balance Sheet – Healthy cash rich B/S INR million Consolidated Balance Sheet Snapshot FY20 FY21 FY22 FY23 FY24 Q1 FY25 Property, plant and equipment (PPE) 3,531 4,371 5,306 5,842 5,672 5,567 Right of use asset (RoU) 9 17 14 169 406 437 Capital work-in-progress 1,016 961 300 1,651 1,790 2,068 I
Slide 28: Suven – Key Ratios
Suven – Key Ratios Key Ratios FY20 FY21 FY22 FY23 FY24 Q1 FY25 Basis Net Working Capital (as days of sales) 97 80 114 96 112 127 Core NWC / Revenue * 365 PPE (as % of sales) 42.3% 43.3% 40.2% 43.6% 54.0% 59.6% Closing PPE / Revenue Capex spend during the year (INR M) 1,029 1,108 752 2,857 518 274 Ca
Slide 29: Cohance Proforma P&L – Snapshot
Cohance Proforma P&L – Snapshot INR million CAGR Proforma P&L Snapshot FY19 FY20 FY21 FY22 FY23 FY24 Q1FY24 Q1FY25 YoY FY19-FY24 Q1FY25 saw revenue growth of Revenue 7,272 8,631 10,043 12,802 13,375 13,408 2,278 2,520 13.0% 10.6% COGS (2,900) (3,705) (4,004) (5,300) (5,058) (4,862) (859) (940) 10.
Slide 30: Cohance Proforma Balance Sheet – Snapshot
Cohance Proforma Balance Sheet – Snapshot INR million Proforma Balance Sheet Snapshot 1 FY19 FY20 FY21 FY22 FY23 FY24 Q1 FY25 Property, plant and equipment (PPE) 3,699 3,824 4,128 4,090 4,217 4,601 5,388 Right of use asset (RoU) 2 0 13 89 179 202 356 368 Capital work-in-progress 45 99 155 458 1,167
Slide 31: Cohance Proforma – Key Ratios
Cohance Proforma – Key Ratios Key Ratios FY19 FY20 FY21 FY22 FY23 FY24 Q1 FY25 Basis Net Working Capital (as days of sales) 163 158 147 150 156 185 160 NWC / Revenue * 365 PPE (as % of sales) 50.9% 44.3% 41.1% 31.9% 31.5% 34.3% 39.5% PPE / Revenue Capex spend during the year (INR M) 313 498 810 911
Slide 32: Proforma P&L Suven + Cohance Combined – Snapshot
Proforma P&L Suven + Cohance Combined – Snapshot INR million CAGR Q1FY25 Combined Proforma P&L Snapshot FY20 FY21 FY22 FY23 FY24 Q1 FY24 Q1 FY25 FY20-FY24 YoY Revenue 16,969 20,140 26,004 26,779 23,922 5,754 4,827 9.0% -16.1% Revenue declined by 16% YoY, COGS (5,997) (7,024) (9,291) (9,283) (7,878)
Slide 33: Proforma BS Suven + Cohance Combined– Snapshot
Proforma BS Suven + Cohance Combined– Snapshot INR million Combined Balance Sheet Snapshot1 FY20 FY21 FY22 FY23 FY24 Q1 FY25 Property, plant and equipment (PPE) 7,354 8,499 9,396 10,059 10,273 10,955 Right of use asset (RoU) 2 22 105 193 372 762 805 Capital work-in-progress 1,114 1,116 758 2,818 4,0
Slide 34: Suven + Cohance Combined Ratios – Snapshot
Suven + Cohance Combined Ratios – Snapshot Key Ratios# FY20 FY21 FY22 FY23 FY24 Q1 FY25 Basis Net Working Capital (as days of sales) 128 113 132 125 153 147 NWC / Revenue * 365 days 43.3% 42.2% 36.1% 37.6% 42.9% 47.6% PPE (as % of sales) 1,527 1,918 1,663 4,203 2,607 1,035 PPE / Revenue Capex spend
Slide 35: Combined Business: Proforma Metrics FY24
Combined Business: Proforma Metrics FY24
Slide 36: Proforma Merged Entity
Proforma Merged Entity FY24 Merged Company INR Mn Revenue 10,514 13,408 23,922 Adjusted EBITDA 4,350 4,183 8,534 Adjusted EBITDA margin % 41.4% 31.2% 35.7% Adjusted PAT 3,194 2,545 5,738 Adjusted PAT margin % 30.4% 19.0% 24.0% RoCE 34.8% 27.4% 30.8% RoE 18.7% 24.9% 21.0% (Net Debt) / Net Cash to Adj
Slide 37: Proforma Merged Entity - Combined business mix
Proforma Merged Entity - Combined business mix Merged Company Formulations & Others 17% Sales Mix (FY24) CDMO API++ 33% API++ CDMO 45% CDMO 67% 55% 83% Manufacturing Facilities 5 (2) 7 (5) 12 (7) (Regulatory approved) R&D Centers 1 4 5 Capacity ~1,400 kL ~1,250 kL ~2,650 kL Source: Cohance LifeScien
Slide 38: Annexure
Annexure
Slide 39: Appendix - Adequate Capacity to serve current and future demand
Appendix - Adequate Capacity to serve current and future demand Vizag, Andhra Pradesh, India Pashamylaram, Telangana, India Suryapet, Telangana, India o 307 KL reactor volume API & Formulation Facility Intermediate Facility o 3KL to 12KL Reactors o 120 KL reaction volume o 300 CM reactors (93) o GL/
Slide 40: Cohance's Specialized manufacturing capabilities
COHANCE’S Specialized manufacturing capabilities API Unit-1, Andhra Pradesh, India API Unit-2, Andhra Pradesh, India API Unit-3, Gujrat, India FDF Unit-1, Telangana, India o USFDA (latest in 2019) o EDQM (latest in 2023) o USFDA (latest in 2023) o USFDA (latest in 2019) o EDQM (latest in 2023) o EDQ
Slide 41: Contact Information
Contact Information Cyndrella Carvalho, Head - Investor Relations, Suven Pharmaceutical Ltd Tel: +91 9823615656 Email: cyndrella.carvalho@suvenpharm.com Gavin Desa / Rishab Barar CDR - India Tel: +91 98206 37649/ +91 77770 35061 Email: gavin@cdr-india.com / rishab@cdr-india.com Pg. 41
Slide 42: Thank You
Thank You
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