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Active pharmaceutical ingredient (API) is a pharmaceutical substance or a mixture of pharmaceutical substances which becomes an active ingredient during the manufacturing. API can be applied clinically after it is processed into pharmaceutical preparation.
As one of the largest API manufacturers, China has established an integrated industrial system, after decades of development. CRI estimated that by the end of 2016, the number of chemical API manufacturers in China had exceeded 1,000, capable of producing 1,500 categories and 5 million tons of APIs.
CRI considers that China is the world's leading exporter of API and enjoys cost advantages compared with competitors. In the past decade, China's share of the global active pharmaceutical ingredient market has been increasing. China is the world's largest producer and exporter of API. Its production volume was over 3 million tons in 2016. Currently, the majority of chemical API companies in China are raw material suppliers, which gain the market share by scale and low costs and are weak in research and development.
CRI analyzed that China now enjoys advantages in API products in the global market. For example, antibiotic and bacteriophage, China-made penicillin, tetracycline and chloromycetin own price advantage. China is also the world's largest manufacturer and exporter of vitamin products, in which VC is the product with the biggest advantage. China's second-largest API exports are antipyretics and analgesics products. As the China's export price is 33.3% lower than the price in the international market, China-made citric acid and dexamethasone take a certain share in the global market.
In the global market of active pharmaceutical ingredient, except for the monopoly of some patented APIs, the market of general chemical API is perfectly competitive. Meanwhile, with the development of global pharmaceutical industry, the increasing demand of generic drugs and the change of API production patterns, international preparation manufacturers tend to outsource production, that is, purchasing APIs from API and preparation producers in developing countries. More and more API and preparation manufacturers in emerging markets, represented by China, India, Brazil and Russia, have been engaged in the supply and demand globally. As the world's largest producer and exporter of API, Chinese API enterprises are confronted with competition not only from domestic competitors but also from foreign enterprises, especially Indian companies. Therefore, China's API industry becomes increasingly competitive.
According to CRI, due to the rising labor cost and increasingly rigorous environment policies in China, the production cost of API has been lifted and consequently Chinese API could not maintain the price advantage. Therefore, the transfer to mid-high end market will be the future development trends of API.
In this report, CRI analyzes 30 API manufacturers listed in A-share market in China. The report provides readers with a quick guide to the profiles and financials of Chinese API manufacturers being listed in the recent 10 years.
The report is composed of two parts: the first part is enterprise profiles and the second part is the operation status of these enterprises in the recent decade (presently 2006 to 2016, we will update it to the latest as time goes by).
The operation status is demonstrated from the following perspectives: (1)financial indexes, such as earnings per share, book value per share (BPS), sales per share, net cash flow per share, return on net worth and debt to asset ratio; (2) indexes on the income statement, such as revenue, operating profit, net profit and EBIT; (3) indexes on the income statement, such as revenue, operating profit, net profit and EBIT; (4) indexes on the balance sheet, such as liquid asset, fixed asset, current liability, non-current liability, capital reserve and shareholders' equity.
Financial Indexes
- Earnings per Share
- Book Value per Share (BPS)
- Sales per Share (SPS)
- Net Cash Flow per Share from Operations
- Net Cash Flow per Share (CNY)
- Return on Net Worth
- Net Profit Margin on Total Assets
- Return on Invested Capital (ROIC) (%)
- Gross Profit Margin on Sales (%)
- Net Profit Margin on Sales (%)
- EBIT Margin (%)
- EBITDA Margin (%)
- Debt to Asset Ratio (%)
- Total Asset Turnover (times)
- Cash/Operating Income Received from Sales of Goods or Services
- YOY Growth Rate of Operating Revenue (%)
- YOY Growth Rate of Operating Profit (%)
- YOY Growth Rate of Net Profit Attributable to Shareholders of Parent Company (%)
Summary of Income Statement
- Gross Revenue (CNY, million)
- Total Operating Costs (CNY, million)
- Revenue (CNY, million)
- Operating Profit (CNY, million)
- Total Profit (CNY, million)
- Net Profit (CNY, million)
- Net Profit Attributable to Shareholders of Parent Company (CNY, million)
- Non-recurring Items (CNY, million)
- Net Profit Deducting Non-recurring Items (CNY, million)
- R&D Costs (CNY, million)
- Earnings Before Interest and Tax (EBIT) (Based on iFind) (CNY, million)
- Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) (Based on iFind) (CNY, million)
Summary of Balance Sheet
- Liquid Asset (CNY, million)
- Fixed Asset (CNY, million)
- Long-term Equity Investment
- Total Assets (CNY, million)
- Liquid Liability (CNY, million)
- Non-current Liability (CNY, million)
- Total Liability (CNY, million)
- Capital Reserve (CNY, million)
- Surplus Reserve (CNY, million)
- Undistributed Profit (CNY, million)
- Shareholders' Equity (CNY, million)
- Equity Attributable to Shareholders of Parent Company (CNY, million)
Summary of Cash Flow Statement
- Cash Received from Sales of Goods and Services (CNY, million)
- Cash Flow from Operations (CNY, million)
- Cash Paid to Purchase Fixed Assets, Intangible Assets and Other Long-term Assets (CNY, million)
- Cash Paid for Investments (CNY, million)
- Cash Flow from Investments (CNY, million)
- Cash Received from Investors (CNY, million)
- Cash Received from Borrowings (CNY, million)
- Cash Flow from Financing (CNY, million)
- Net Increase of Cash and Cash Equivalents (CNY, million)
- Cash and Cash Equivalents, End of Period (CNY, million)
- Depreciation and Amortization (CNY, million)