Report on “Business analysis on pharmaceutical companies”

MIS 415
Section- 01

Submitted to
Abu Sadat Muhammad Ashif
Associate Professor of
Department of Business Administration
East West University

Submitted by

Na ID Participation
me (%)
MD Yousuf Ali 2019-2-10- 20%
213
2018-3-10- 20%
Md. Akib Mansur 009
Md. Al-Amin 2020-2-10- 20%
054
Mahfuja Rahman 2019-3-10- 20%
006
Bijaya Sinha 2020-2-10- 20%
 084

Letter of Transmittal

12th December 2023

Abu Sadat Muhammad Ashif
Associate Professor of
Department of Business Administration
East West University

Subject: Report on “Business analysis on pharmaceutical companies”

Dear Sir,

It gives us immense pleasure to submit to you the report on Beacon, Reneta and Beximco
pharmaceutical ltd.

While preparing the report, we closely focused on the topic & tried to assimilate and provide the
most complete information available. I believe that it will provide you with a clear overview of
the Beacon, Reneta and Beximco pharmaceutical’s their functions, responsibilities, performance,
and the role they have played to ensure investor protection, securities market stability etc.

I thank you for allowing us to do a term paper on Beacon, Reneta and Beximco pharmaceutical
ltd. This will give us a vast amount of knowledge and experience which we can use in our
professional life. We will always be available for any further queries and to answer any questions
about this report.

Sincerely,

On behalf of my group
MD Yousuf Ali
2019-2-10-213
East west University
 Acknowledgement

The completion of this term paper gave us much pleasure and we would like to show gratitude
towards our honorable course instructor Abu Sadat Muhammad Ashif for providing us with the
opportunity to observe and analyze such an interesting topic and for his supervision, guidance,
and valuable advice for this term paper through numerous information and conclusions whenever
needed. Without his guidance, we would not be able to do this. We have learnt many aspects
which will help us in the future.
 Executive Summary

Over the past five years, Beacon Pharmaceuticals PLC has shown consistent financial growth,
marked by a steady increase in total assets and a robust Return on Equity (ROE). The company's
effective management of interest income and expenses, reflected in a notable rise in Net Interest
Margin (NIM), further enhances its financial profile. However, a slight dip in Return on Assets
(ROA) and Net Profit Margin (NPM) in 2022 warrants a closer examination of potential
challenges.

Renata Limited has demonstrated financial stability with incremental growth in total assets,
reaching 36423 million in 2022. While maintaining a decent Return on Equity (ROE), the
company has exhibited gradual improvements in Net Interest Margin (NIM) and consistently
effective cost management practices, as evidenced by a stable Net Profit Margin (NPM).

Beximco Pharmaceuticals Limited has consistently increased total assets and maintained a stable
Return on Equity (ROE), coupled with positive growth in Net Interest Margin (NIM). However,
fluctuations in Return on Assets (ROA) and Net Profit Margin (NPM) in 2022 raise caution and
necessitate a more in-depth analysis. Investors are advised to consider these nuanced financial
dynamics and potential industry challenges before making investment decisions.
 Overview of the company’s
Beacon Pharmaceuticals PLC is a Bangladeshi pharmaceutical company that develops
generic version of medications.

Beacon manufactures more than 200 generic drugs and 65 oncology products. Beacon is the first
company in Bangladesh to start export of cancer drugs. The company is exporting its products to
Asia, Africa, Europe and Latin America. Beacon is public limited company listed in Dhaka &
Chittagong stock exchange. About 2000 people are working in this company.

Beacon has introduced a number of global first generics.

MISSION

To improve the quality of human life by providing innovative pharmaceutical products

developed through continuous research and development ensuring stakeholders satisfaction.

VISION

To be regarded and recognized as one of the most value-driven pharmaceutical companies in the
country.

Renata Limited is one of the leading and fastest growing pharmaceutical and animal health
product companies in Bangladesh. The company started its operations in 1972 as Pfizer
(Bangladesh) Limited. In 1993, Pfizer transferred the ownership of its Bangladesh operations to
local shareholders and the name of the company was changed to Renata Limited.

The core businesses of Renata Limited are human pharmaceuticals and animal health products.
In Bangladesh it is the 4th largest pharmaceutical company and the market leader in animal
health products. In addition, Renata products are exported to Afghanistan, Belize, Cambodia,
Ethiopia, Guyana, Honduras, Hong Kong, Kenya, Malaysia, Myanmar, Nepal, Philippines, Sri
Lanka, Thailand, United Kingdom, and Vietnam. The Company is listed on the Dhaka Stock
Exchange with a market capitalization of over USD $1 billion.

The Company has ten manufacturing facilities spread over three manufacturing sites.
Distribution of products is carried out by 19 depots across the country.
vision:

To establish Renata permanently among the best of innovative branded generic companies.

Mission:

To provide maximum value to our customers, shareholders, colleagues, and communities where
we live and work.Renata employs over 8,000 people

Beximco Pharmaceuticals Limited is a leading manufacturer and exporter of medicines in

Bangladesh. Incorporated in 1976, the Company started its operation by importing products from
Bayer, Germany and Upjohn, USA and selling them in the local market. In 1980, Beximco
Pharma began manufacturing of these products under licensing arrangement and the company
launched its own formulation brands in 1983. From that humble beginning, Beximco Pharma has
grown from strength to strength. Today, it has emerged as a global generic pharma company in
the region. The Company’s manufacturing facilities have been accredited by the leading global
regulatory authorities, and medicines manufactured by the Company are now being exported to
more than 50 countries including the highly regulated markets of USA, Europe, Canada and
Australia. Beximco has won the National Export (Gold) trophy for 5 times. It remains the only
Company in the country to win the highly prestigious SCRIP Award as the “Best Pharma
Company in an Emerging Market” and also won CPhI Pharma Awards 2020 for “Innovation in
Response to COVID-19.” It also has the unique distinction as the only Bangladeshi Company
listed on the AIM of London Stock Exchange.

Our Mission
We are committed to enhancing human health and well being by providing contemporary and
affordable medicines, manufactured in full compliance with global quality standards. We
continually strive to improve our core capabilities to address the unmet medical needs of the
patients and to deliver outstanding results for our shareholders.

Our Vision
We will be one of the most trusted, admired and successful pharmaceutical companies in the
region with a focus on strengthening research and development capabilities, creating partnerships
and building presence across the globe.

Analysis

Beacon pharmaceutical
 Particulars Total Total ROE ROA NIS EPS NPM
Asset liability

2018 3761 1959 27.32% 3.35% 19.96% 0.51% 3.35%

2019 4647 2367 28.83% 2.54% 21.28% 1.65% 2.54%

2020 5591 2789 27.74% 6.82% 23.25% 3.74% 6.82%

2021 7121 3241 25.93% 12.12% 30.62% 4.05% 12.12%

2022 8023 3698 27.11% 11.65% 31.54% 2.21% 11.65%

Total Asset:

Beacon's total assets have shown a consistent upward trend from 2018 to 2022, indicating overall
growth and expansion.

Total Liability:

Total liabilities have also increased over the years, but it's important to compare this with the
total assets to understand the company's leverage and financial stability.

ROE (Return on Equity):

Return on Equity (ROE) has been fluctuating but generally remains at a healthy level. ROE
measures the profitability of the company in relation to shareholders' equity. The increasing trend
until 2019 and subsequent fluctuations might warrant further investigation.

ROA (Return on Assets):

Return on Assets (ROA) saw a significant increase in 2020, indicating improved efficiency in
utilizing assets to generate profits. However, there was a subsequent decrease in 2021 and 2022,
suggesting a potential dip in asset efficiency.

NIS (Net Income Margin):

Net Income Margin (NIS) shows the percentage of revenue that translates into net income.
There's a steady increase from 2018 to 2022, indicating the company's ability to convert a higher
percentage of revenue into profit.

EPS (Earnings Per Share):

Earnings Per Share (EPS) has experienced fluctuations but generally increased over the years.
This suggests that the company's profits are growing on a per-share basis.

NPM (Net Profit Margin):

Net Profit Margin (NPM) has shown an increasing trend, indicating that the company is
becoming more efficient in managing costs and generating higher net profits relative to revenue.

In summary, Beacon's financial performance appears positive, with consistent growth in total
assets, increasing net income margin, and rising earnings per share. The fluctuations in ROE and
ROA may warrant further investigation, and it's essential to consider industry benchmarks and
external economic factors for a comprehensive analysis. Overall, the company seems to have
improved its profitability and operational efficiency over the specified years.

Power BI (Beacon)

Reneta pharmaceutical

Particulars Total Total ROE ROA NIS EPS NPM

Asset liability
 2018 25865 4281 23.36% 5.16% 1.98% 30.42% 7.31%

2019 28936 5452 24.32% 5.39% 2.54% 34.01% 7.46%

2020 31776 6036 23.78% 5.63% 3.23% 38.14% 7.6%

2021 34612 6869 22.79% 5.26% 3.84% 40.17% 7.33%

2022 36423 8181 22.12% 5.07% 4.49% 45.06% 7.34%

Total Asset:

The total assets of Reneta Pharmaceuticals have been consistently increasing each year. This
indicates the company's growth and expansion in its asset base.

Total Liability:

The total liabilities also show an increasing trend, suggesting that the company has taken on
additional obligations over the years. It's important to assess the ratio of total liabilities to total
assets to understand the company's leverage.

ROE (Return on Equity):

Return on equity has experienced a slight decrease from 2018 to 2022 but has remained
relatively stable overall. ROE measures the profitability of the company in relation to
shareholders' equity. A stable ROE suggests consistent returns for shareholders.

ROA (Return on Assets):

Return on assets has shown a slight fluctuation but has remained relatively stable. ROA indicates
how efficiently the company is utilizing its assets to generate profits.

NIS (Net Income Margin):

Net income margin has steadily increased over the years. This suggests that Reneta
Pharmaceuticals has been able to convert a higher percentage of its revenue into net income,
indicating improving profitability.

EPS (Earnings Per Share):

Earnings per share have been consistently increasing, which is a positive sign for shareholders. It
indicates that the company's profits are growing on a per-share basis.

NPM (Net Profit Margin):

Net profit margin has also seen a gradual increase. This indicates that the company is managing
its costs effectively, resulting in a higher percentage of revenue turning into net profit.

In summary, Reneta Pharmaceuticals appears to have a positive financial performance over the
specified period. The consistent growth in total assets, increasing net income margin, and rising
earnings per share suggest that the company is managing its resources efficiently and generating
improved profitability. The stable ROE indicates that the company is providing consistent
returns to its shareholders. It would be important to assess industry benchmarks and economic
conditions for a more comprehensive analysis.

Power BI (Reneta)

Beximco pharmaceutical
 Particulars Total Total ROE ROA NIS EPS NPM
Asset liability

2018 49214 3376 22.06% 6.81% 4% 6.8% 13.29%

2019 50119 3827 22.42% 6.82% 4.16% 7.88% 13.72%

2020 52246 4812 22.36% 8.63% 4.35% 11.49% 17.39%

2021 66148 5531 22.24% 7.37% 4.54% 11.48% 14.78%

2022 69157 6973 22.12% 5.88% 4.75% 10.34% 11.75%

Total Asset:

The company has experienced consistent growth in total assets over the five-year period,
indicating expansion and increased investment in assets.

Total Liability:

The total liabilities have also increased over the years. It's important to monitor the relationship
between total assets and total liabilities to assess the company's leverage. A healthy balance is
crucial for financial stability.

ROE (Return on Equity):

The return on equity has remained relatively stable around 22% over the years. This indicates
that the company is generating a consistent return on shareholders' equity.

ROA (Return on Assets):

ROA experienced some variability, with a notable increase in 2020 and a decrease in 2022. This
suggests that while the company efficiently used its assets to generate profit in 2020, there was a
decline in asset efficiency in 2022.

NIS (Net Income Margin):

The net income margin has shown a gradual increase, reflecting the company's ability to convert
a higher percentage of revenue into net income. This is a positive trend indicating improved
profitability.

EPS (Earnings Per Share):

Earnings per share have been consistently increasing, indicating growth in earnings on a per-
share basis. This is favorable for shareholders as it demonstrates an improvement in the
company's profitability.

NPM (Net Profit Margin):

Net profit margin exhibited variability, with a significant increase in 2020 and a decrease in
2022. This suggests that the company effectively managed costs in 2020 but faced challenges in
maintaining the same level of efficiency in 2022.

In summary, the company appears to be in good financial health with stable returns for
shareholders, consistent growth in earnings per share, and a positive trend in net income margin.
However, the fluctuations in return on assets and net profit margin highlight areas that may
require attention, such as optimizing asset efficiency and cost management. It's crucial to
consider industry benchmarks and economic conditions for a more thorough analysis of the
company's performance.

Power BI (Beximco)
 Conclusion
In conclusion, the analysis of Beacon Pharmaceuticals PLC, Renata Limited, and Beximco
Pharmaceuticals Limited reveals overall positive trends in financial performance over the last
five years. Each company has experienced growth in total assets, demonstrating increased wealth
and resources. However, there are variations in certain financial metrics that warrant attention.

Renata Limited has shown steady growth in total assets and a respectable ROE. While net
interest margin and earnings per share have improved, there are minor fluctuations in return on
assets and net profit margin. Renata's ability to manage costs effectively is reflected in the stable
NPM.

Beximco Pharmaceuticals Limited, with consistent growth in total assets and a stable ROE, has
demonstrated effective profitability. The company's net interest margin has shown positive
growth, but there are fluctuations in return on assets and net profit margin, particularly a
decrease in 2022.

Investors should consider the overall financial health, industry dynamics, and specific challenges
faced by each company before making investment decisions. While positive trends are evident,
fluctuations in certain financial metrics, especially in 2022, suggest the importance of thorough
analysis and ongoing monitoring of these pharmaceutical companies.

In comparing the financial data of Beacon Pharmaceuticals, Renata Limited, and Beximco
Pharmaceuticals Limited, each company exhibits distinct strengths and areas of consideration for
potential investors. Beacon Pharmaceuticals has showcased consistent growth in total assets and
increasing net income margin, reflecting positive operational efficiency. However, fluctuations
in ROE and ROA may warrant careful evaluation of the company's financial strategy. Renata
Limited, on the other hand, demonstrates steady growth in assets, liabilities, and net income
margin, with a strong focus on cost management. The company's consistent increase in earnings
per share and net profit margin portrays a financially stable and efficient operation. Beximco
Pharmaceuticals, while displaying consistent asset growth and stable returns, has shown
variability in net profit margin and ROA. Investors might scrutinize the reasons behind these
fluctuations and assess the company's ability to maintain profitability. In conclusion, Renata
Limited appears to be a preferable choice for investment due to its stable financial performance,
consistent growth, and focus on innovation in the pharmaceutical sector. However, individual
investors should conduct thorough research, considering their risk tolerance and investment
objectives before making a decision.
 References

https://www.lankabangla.com/
https://en.wikipedia.org/wiki/Beacon_Pharmaceuticals.
https://renata-ltd.com/about-us/
https://www.beximcopharma.com/about-us