Novartis India Ltd

• 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 company’s 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 world’s 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 AstraZeneca’s 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 company’s sales came from pharmaceuticals, 44% from crop protection and the rest from vision care products, seeds and animal health products.