Piramal Pharma Limited: $200 Billion CDMO Market Opportunity
Piramal Pharma Ltd: Overview
Piramal Pharma Limited is a global pharmaceutical company providing end-to end pharma solutions to its customers through its network of development and manufacturing facilities located in India, North America and the UK/Europe. It also offers a portfolio of differentiated products that it sells in over 100 countries across the world. PPL operates under three business verticals: Piramal Pharma Solutions (PPS) An integrated contract development and manufacturing organisation (CDMO); Piramal Critical Care (PCC) A complex hospital generics (CHG) business; and India Consumer Healthcare (ICH) The business of selling over-the-counter healthcare and wellness products. As per an industry report, the global pharmaceutical CDMO market size was estimated at US$ 140 Billion in 2023 and is projected to grow at a CAGR of 7% in 2024-30 to cross $200 billion. This growth would be primarily driven by rising investments in pharmaceutical R&D, demand for generic drugs. . In the global complex generics market, hospital generic products dominate with a share of around 70-80%, while retail products comprise the remaining portion. Key therapy areas within the complex hospital generic market include Anaesthesia, Pain Management, Blood-related, and Anti-Infective segments.
Latest Stock News (17 Jan, 2025)
Piramal Pharma has converted its coal-fired steam boiler to a biomass-fuelled one at its manufacturing facility in Digwal, India. The strategic conversion at the Digwal facility will eliminate approximately 24,000 tonnes of carbon dioxide equivalent (tCO2e) GHG emissions annually, accounting for about 17% of the company’s total emissions, said the company. Adopting biomass briquettes is a key advancement in Piramal’s sustainability journey. These briquettes are compacted blocks of biomass materials processed and compressed under high pressure. Biomass briquettes, made from agricultural waste, are a renewable fuel source that supports circular economy principles by recycling organic by-products, reducing waste, and promoting sustainability. “The transition to biomass briquettes at our Digwal facility is a testament to our commitment to reducing our environmental footprint while driving innovation in sustainable manufacturing. As we align our goals with global climate action frameworks, we will continue to contribute to a more sustainable future for generations to come,” said Nandini Piramal, chairperson, Piramal Pharma Limited. “This transformation at our Digwal facility underscores our commitment to environmental stewardship and sustainable operational practices,” said Peter DeYoung, CEO of Piramal Global Pharma. “By transitioning to biomass briquettes, we are significantly reducing our GHG emissions and setting new industry standards for responsible pharmaceutical manufacturing.”
Stock Potential
Piramal Pharma Ltd has strategically diversified its operations into three niche business segments, all of which are driving strong revenue growth. The company’s expansion into the U.S. market with new products and SKUs reflects its commitment to growth and innovation. Additionally, increasing government capital expenditure year-on-year is boosting demand, further benefiting the company. However, the fundamentals appear highly overvalued at a P/E of 527, which is significantly above industry norms. For investors to realize better returns, either the stock price needs to correct, or the company must achieve exponential revenue growth in the next year or two to justify its steep valuation.