Viyash Scientific Limited · NSE:VIYASH
Viyash Scientific — SeQuent Scientific — Merger or Acquisition (September 2024)
33 slides from Viyash Scientific's merger presentation, Sep 27, 2024
Slide 1: Proven Ability In Life Sciences
Proven Ability In Life Sciences September 27, 2024 BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Exchange Plaza, Bandra Kurla Complex, Dalal Street, Fort Bandra (E), Mumbai - 400 001 Mumbai - 400 051 Scrip code: 512529 Symbol: SEQUENT Dear Sir/ Madam, Subject: Inves
Slide 2: Investor Presentation Merger Proposal
Investor Presentation Merger Proposal SEQUENT SCIENTIFIC LIMITED 27 September 2024 1
Slide 3: Table of Contents
Table of Contents 01 Strategic Focus 04 Transaction Details 02 Transaction Rationale 05 Annexure 03 Target Overview 2
Slide 4: Safe Harbour
Safe Harbour The contents of this document are for your information only and are intended to provide an overview of the material aspects of the proposed transaction. This document does not purport to provide all and complete details, as may be required to make a full analysis of SeQuent, Viyash or t
Slide 5: Strategic Focus
Strategic Focus 01
Slide 6: Embarking on SeQuent 3.0
Embarking on SeQuent 3.0 SeQuent SeQuent 3.0 SeQuent 2.0 Creating a unique, differentiated 1.0 global animal health player Sharpening focus 2024 onwards • Focus on building end-to-end integrated Building blocks for growth 2019 – 2024 capabilities to capture market opportunities • Strengthened front-
Slide 7: SeQuent 3.0 – Key Pillars of Our Strategy
SeQuent 3.0 – Key Pillars of Our Strategy A unique, differentiated, and scaled global animal health leader with end-to-end integrated capabilities 1 2 Manufacturing Scale & 3 4 R&D Expertise Robust Supply Chain Front-end Presence Quality • Enhance scale for • Accelerate drug • Minimize external • Ex
Slide 8: Adopted an Inorganic Merger Route To Significantly Strengthen The Pillars
Adopted an Inorganic Merger Route To Significantly Strengthen The Pillars 1 2 3 4 R&D Expertise Manufacturing Scale Robust Supply Chain Front-end Presence 9x increase in Opportunity to 5x increase in R&D USFDA approved End-to-end capture high-growth team size manufacturing capability parts of global
Slide 9: Transaction Rationale
Transaction Rationale 02
Slide 10: Transaction Summary
Transaction Summary Overview • We are proposing a merger of SeQuent Scientific and Viyash Lifesciences Private Limited • Build a unique, differentiated, global end-to-end integrated platform with leadership in animal pharmaceuticals, supported by strong operating and R&D backbone o Create an Integra
Slide 11: Superior Financial Profile of the Merged Entity with Healthy Balance Sheet
Superior Financial Profile of the Merged Entity with Healthy Balance Sheet To Support Future Expansion Q1 FY25 SeQuent Merged Entity (For the quarter) Revenue ~2x Revenue 3,400 3,902 7,302 (INR Mn) EBITDA1 ~2x EBITDA 580 483 1,063 (INR Mn) Improved margin EBITDA Margin % 17.1% 12.4% 14.6% profile Ne
Slide 12: Strong R&D, Superior Scale, Integrated Supply Chain, and Enhanced Front-end Presence
Strong R&D, Superior Scale, Integrated Supply Chain, and Enhanced Front-end Presence R&D Expertise Manufacturing Scale Robust Supply Chain Front-end Presence R&D Team size Manufacturing capacity Manufacturing facilities USFDA approved units Minimizing External Marquee Customers Dependencies ($1Bn+ a
Slide 13: R&D: Market Leadership In Drug Filings Driven By Strong R&D Engine
R&D: Market Leadership In Drug Filings Driven By Strong R&D Engine And Faster Time To Market Strong R&D Engine Advance Technical Capabilities Complex chemistry High end analytical capabilities instruments Combined active Combined R&D Among the top NPD2 projects expenditure players LC-MS/MS-3 nos, Po
Slide 14: R&D: Leveraging Strong Execution & Track Record To Build a CDMO Powerhouse
R&D: Leveraging Strong Execution & Track Record To Build a CDMO Powerhouse Recent Animal Health CDMO Viyash’s Strong Execution Track Record Global Animal Health CDMO Market wins in India High OTIF rates Strong client Flawless regulatory advocacy focus Global Top 5 AH player 90-95% on-time launches 6
Slide 15: Manufacturing: Scaled Complex Manufacturing Capabilities with Cost Leadership
Manufacturing: Scaled Complex Manufacturing Capabilities with Excellent Track Record of Achieving Cost Leadership Scaled Complex Manufacturing Capability Establish Cost Leadership ~2400 kL ~370 kL Increasing Importance For Cost Strong Track Record Of Competitiveness Commercial Excellence Sequent Com
Slide 16: Enhance Front-end Presence: Increase Wallet Share In Strategic Customers
Enhance Front-end Presence: Increase Wallet Share In Strategic Customers Through Joint GTM Capabilities Increase wallet share through enhanced product offerings Viyash’s customers SeQuent’s customers Joint GTM strategy 5 out of top 10 5 out of top 10 customers are scaled customers1 are scaled player
Slide 17: Target Overview
Target Overview 03
Slide 18: Viyash Business Overview
Viyash Business Overview Integrated pharmaceutical company with a strong portfolio of APIs & API ++ Regulatory & Operational Financial Metrics R&D Metrics Footprint 13,600 #1 ~2,000 KL Q1FY25 Ann Highest DMF Total Revenue1 filings among Capacity Indian peers in ~200 9 (INR Mn) Q1FY25 2,320 USFDA R&D
Slide 19: Strong Business Profile
Strong Business Profile Market leadership – Top 3 supplier globally in 5 out of 7 focus molecules Experienced management team with 6 Attractive product basket – Diversified decades of collective experience to therapy areas across anti-inflammatory support the strategy & anti-psychotics Robust pipeli
Slide 20: Experienced CEO with Strong Operational Expertise & 3+ Decades Of Global Pharma Experience
Experienced CEO with Strong Operational Expertise & 3+ Decades Of Global Pharma Experience Dr. Hari Babu Bodepudi Whole-time Director & CEO • 30 years of industry experience with roles in research, manufacturing, quality and operations for APIs & oral solids • Former CEO, Mylan India & Global COO, M
Slide 21: Highly Experienced Management Team
Highly Experienced Management Team Mr. Ramakant Singani Dr. Pramod Kumar Mr. Vasireddy Srinivas Chief Financial Officer SVP & Head – API R&D SVP & Head – API Operations Dr. Srihari Raju Kalidindi • 27 years of Industry experience • 28 years of Industry experience • 33 years of Industry experience Fo
Slide 22: Strong R&D Expertise: 2nd Highest Drug Filings Among Peers
Strong R&D Expertise: 2nd Highest Drug Filings Among Peers US filings: Despite Nascent entry, Viyash is ahead of its peer set 49 DMFs filed between 2021-Q2’2024 28 21 18 13 13 9 5 3 Player 1 Player 2 Player 3 Player 4 Player 5 Player 6 Player 7 Player 8 (NA) (~INR 10bn) (~INR 20bn) (~INR 10bn) (~INR
Slide 23: Scaled & Specialized Manufacturing Capabilities With Excellent Regulatory Track Record (1/2)
Scaled & Specialized Manufacturing Capabilities With Excellent Regulatory Track Record (1/2) Footprint1 Regulatory Track Record 1.2 Bn 9 ~2,000 KL 28 NIL 9 units Manufacturing Oral Solids # USFDA % Official Action Capacity USFDA Sites units Capacity inspections2 Initiated Niche & Key Areas of Expert
Slide 24: Scaled & Specialized Manufacturing Capabilities With Excellent Regulatory Track Record (2/2)
Scaled & Specialized Manufacturing Capabilities With Excellent Regulatory Track Record (2/2) State-of-the art manufacturing facilities Cutting-edge R&D Labs 23 Source: Company website & Management data Note 1. All facilities are USFDA approved except Vandana Life Sciences & Symed Labs Limited, Unit-
Slide 25: Leading Market Position In Focus Segments
Leading Market Position In Focus Segments Outsourced API - Market Share % (FY24) 100% Others Others 80% Others Peer 2 Others Others Others Peer 2 60% Viyash (~35%) Peer 2 Viyash (~20%) Peer 2 Viyash (~10%) 40% Peer 2 Viyash (~20%) Peer 1 Peer 2 Peer 1 20% Peer 1 Peer 1 Peer 1 Peer 1 Viyash (~20%) Vi
Slide 26: Near-term Pipeline: High Quality Pipeline With ~40% Molecules Having $1bn+ Market Opportunity
Near-term Pipeline: High Quality Pipeline With ~40% Molecules Having $1bn+ Market Opportunity Pipeline Molecules Present In Large/Sizeable Markets, Superior Pipeline Vs Peers With High Growth Rates & Higher Share Of Regulated Markets Number of pipeline products Market size of pipeline molecules Mark
Slide 27: Consistent Revenue Growth & Improving Margin Profile
Consistent Revenue Growth & Improving Margin Profile Factors driving revenue Consistent 12,060 13,110 ➢ Entered new accounts post FY22 & scaled Revenue 9,100 these to INR 5 Cr+ by FY24 Growth 5,400 3,400 ➢ Gains from existing customers through (INR Mn) cross-selling & increasing Share of wallet FY21
Slide 28: Transaction Details
Transaction Details 04
Slide 29: Viyash's Implied Valuation Multiple is at a 44% Discount To SeQuent
Viyash’s Implied Valuation Multiple is at a 44% Discount To SeQuent Peers discount to SeQuent multiple Peers’ Discount (% of SeQuent Mx) to Corresponding EV/LTM EBITDA Mx for SeQuent for Relevant Timeframe 100% 7% 7% 8% 19% 24% 44% SeQuent EV / LTM EBITDA Current EV/LTM 6-month average EV/LTM 3-year
Slide 30: Transaction Overview
Transaction Overview Pre-merger shareholding structure Post-merger shareholding structure1 Current Public CA Harbor & CA Public Shareholders CA Harbor Others Others2 Shareholders Hull 47.1% 52.8% 0.2% 27.4% 10.2% 62.4% • Upon merger of Viyash with SeQuent, the shareholders of Viyash will be issued 5
Slide 31: Strong corporate governance practices followed while evaluating the potential merger
Strong corporate governance practices followed while evaluating the potential merger Strong corporate governance practices followed while evaluating the potential merger Deal Advisor • Leading domestic investment bank Financial and Tax • Leading advisory firms Advisor Independent Valuer • Joint valu
Slide 32: Annexure
05 Annexure
Slide 33: Merged Entity P&L – Snapshot
Merged Entity P&L – Snapshot Viyash SeQuent Combined INR Mn FY24 Q1'25 FY24 Q1'25 FY24 Q1'25 Revenue 13,110 3,400 13,697 3,902 26,807 7,302 Cost of goods sold (6,142) (1,580) (7,597) (2,143) (13,739) (3,723) Gross profit 6,968 1,820 6,100 1,759 13,068 3,579 Margin % 53.2% 53.5% 44.5% 45.1% 48.7% 49.
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