Wanbury Ltd - Rs.72.00

Wanbury Ltd was formed with the merger of Pearl Organics and Wander Ltd. in October’03. Pearl Organics is an API manufacturer focused on the regulated US/ European markets whereas Wander is an ethical formulations company focused on branded formulations in the domestic market. The key bulk drugs manufactured by the company are Gabapentin, Metformin, Ibuprofen, Glucosamine, Salsalate, Mefenamic acid etc. Wanbury is the world’s largest producer of Metformin - a diabetes management product with exports to more than 50 countries. Most of the leading global generic players in regulated markets like Apotex, Mylan, Torr, Barr, Teva, Dexxon, Pliva etc source their product from Wanbury and around 65% of its exports are to regulated markets. In the formulations business, company’s product profile comprises of Gynaecology, Orthopaedic Pediatrics, Nurtrition etc. This division boasts of 450 professionals, 18 brands, 24 distributors and about 1200 stockists across the country.

Wanbury has three manufacturing facilities spread across Patalganga & Tarapur in Maharashtra and Tanuku in Andhra Pradesh. Of these, its Patalganga and Tanuku facilities are USFDA approved for multi-products. It has also set up two hi-tech R&D centres: one in Turbhe, Navi Mumbai, for API and another at Chembur, Mumbai, for formulations. Notably, the company already has 4 Drug Master Files (DMFs) in the US and 2 in Europe, whereas lately it has filed for 4 more DMFs with USFDA in the field of Cardiovasculars, Central Nervous System, Anti-Inflammatory Segment. In the coming few months, it is expected to file 10-15 DMFs further. On the formulation front, Wanbury launched 'Coriminic' range of cough and cold formulations for Pediatric use, which has been well-received in the market. Under the expansion plan, the company has just completed its first phase and commissioned a new unit at Tanuku to manufacture three high value products: Sertraline, Paroxetine and Carvedilol, which have a strong market. The second phase of expansion would be completed by August’06 in which 4-6 new products would be added to the existing product portfolio.

Wanbury continues to grow organically as well as inorganically and has acquired Pharmaceutical Products India Ltd., an API manufacturer. It has a facility at Tarapur and another large partly finished facility at Patalganga, which is meant for regulated markets and will be USFDA compliant. Besides, Wanbury has also taken 51% stake in Doctors Organic Chemical Ltd. (DOCL) - another API making company that will enable Wanbury to foray into contract manufacturing for the regulated markets. DOCL has a USFDA approved facility for the manufacture of non-sterile APIs where it manufactures ibuprofen, mefenamic acid, glucosamine and gabapentene and is a contract manufacturer for leading global pharma companies like Pfizer to which it supplies gabapentene intermediate and mefenamic acid. Further, Wanbury is close to acquiring a branded generics company in the UK, which will be its first overseas acquisition and will strengthen its international presence. With all these expansions and acquisitions, Wanbury is estimated to grow phenomenally in coming years and may report Sales of Rs.150 cr. and net profit of Rs.16 cr. for FY07. This translates into EPS of Rs.13 on its equity of Rs.12.75 cr. Hence investors are strongly recommended to buy at current levels to double their money in 12-15 months. With 52W high at Rs.200, it’s a safe bet.