- Commercial paper programme- Rs. 50 Crores
Rating : P1+ (reaffirmed)
The "P1+" (pronounced P one plus) rating
assigned to the Rs. 500 million Commercial Paper Programme of Novartis India Ltd. (NIL)
has been reaffirmed.
The rating reflects the strengths Novartis India Limited (NIL) derives
from its strong parentage, its strong business position in both the pharmaceutical and the
crop protection businesses, its favorable financial position and its operating efficiency.
These strengths are tempered by the risks associated with the dependence on relatively
older molecules in the companys crop protection portfolio, the seasonal nature of
business and high dependence on outsourcing. For the nine months ended December 1999, NIL
recorded sales of Rs. 6.6 billion and PAT of Rs. 813 million.
NIL is a 51% subsidiary of Novartis AG, Basle (S&P rated AAA), one
of the worlds leading players in the life sciences business. NIL is a leading player
in the domestic pharmaceutical and crop protection businesses and derives strong
technology and product support from its parent. Novartis AG announced the separation of
its agribusiness excepting animal health into a separate venture with AstraZenecas
agrochemical business to be called Syngenta. This is likely to be replicated in India in
due course. The move will not change the credit quality of NIL. In 1998-99, 46% of the
companys sales came from pharmaceuticals, 44% from crop protection and the rest from
vision care products, seeds and animal health products.