Pharma Sector Unleashing for a Robust Growth In 2020, A Soon to Become Market Leader

1. Edition: 17th April 2020 #TheChemAnalystExpress Pharma Sector Unleashing Key Headlines •U.S. Natural Gas Supplies Likely to Rise to 73 Billion Cubic Foot, EIA Reports •China Stocks Up Super Low LNG Amid Lengthened Supply •ExxonMobil’s Old Refinery Site to Be Converted to A Full-Fledged Solar Farm •India’s Q4 Earnings Highlight Pharma Sector’s Rule as A Market Leader •Asian LNG Buyers Delay Shipments Due to Supply Glut Asia Pacific Chemicals Pricing (Key Products) •Benzene- Benzene prices witnessed an uptrend on recovery in downstream demand as several industries resumed their production after prolonged shutdown. CFR prices of the product settled at $390/ tonne India, up by around $10/ tonne. •Ethylene: Ethylene tumbled in Southeast Asia on fall in values of upstream crude oil followed by excess supply of the product against stagnant demand. CFR Prices of Ethylene in Southeast Asia settled at $360/ tonne, down by $20/tonne from previous revision. •MEG- Prices of MEG remained in doldrums on reduced consumption from industries at the back of production cuts and turnarounds amid coronavirus. MEG prices plunged to $400/tonne CFR Southeast Asia with a marginal fall of $5/tonne. •Styrene Monomer- Prices of Styrene Monomer were pushed up in Southeast Asia amid rising demand from downstream industries. CFR Prices for SM in China rose to $610/tonne, up by $ 35/tonne. Crude Oil Scenario Crude prices spiked on Thursday, with U.S. crude rebounding from 20-year lows in the previous session on hopes that U.S. inventory pile ups may trigger producers to curtail their outputs as the pandemic crashes oil demand. Brent crude was up by 2.5 per cent, at $28.38 a barrel by 01:02 GMT while US West Texas Intermediate (WTI) was up by 2.8 per cent, at $20.43. As per the US Energy Information Administration (EIA) report last week, the U.S. crude production is expected to slump by 470,000 bpd. Some analysts also believe that raising of bets by the participants triggered higher crude rates. Pharma Sector Unleashing ffor or a a Robust Growth In 2020, A Soon Robust Growth In 2020, A Soon t to Become Market Leader o Become Market Leader Index WTI Crude Oil Brent Crude Natural Gas (U.S.) Units USD/bbl. USD/bbl. USD/MMBtu Prices 20.43 28.38 1.690

2. Exclusive News & Analysis If we look at the current situation of coronavirus crisis, India has been a country of both loss and gains as compared to hardly hit United States, China and Europe. India has been quite successful in preventing the spread of the pandemic from reaching uncontrollable Stage III using social distancing and early lockdown of the states as its weapons. Country has been unitedly coming up with awareness programs and tracking contacts towards quarantining positive suspects and containing the contagious spread of this virus. Moreover, the country has been lending a helping hand to other nations through its advanced medical supplies and drugs (especially hydroxychloroquine). With lesser deaths and flattening infection curve as compared to other countries, the country is hopeful to win over the situation sooner than other major economies and this offers the country a plethora of opportunities amid financial distress. Strong governance and competitive advantage are likely to keep the country at an upper edge at this time of crisis. Amid Covid Crisis, Indian Pharma Sector Looks Healthier Than All Other Sectors The Indian pharmaceuticals market stands at the third position in terms of volume and is the world’s thirteenth largest in terms of value. The industry is expected to grow at a CAGR of 22.4% to reach USD 55 billion by 2020. India’s vast raw material base and the availability of a skilled workforce enables it to enjoy competitive advantage. The generic drugs segment covers nearly 70 per cent of the Indian pharma market, whereas Over the Counter (OTC) medicines holds 21 per cent share and patented drugs make up to 9 per cent respectively. India’s Pharma Exports Skyrocketed This Year The pharmaceutical exports of India have steadily grown from $10 billion to $19 billion within 2012-2019. The exports had touched $13.69 billion by January 2020 and are expected to show a growth by 30 per cent to reach US$ 20 billion by the end of FY20. Cheaper stocks and improved production technologies have made several nations approach the country seeking medical assistance through the crisis. Recently, India was asked to remove ban on exports of critical drugs to encourage an easy flow of trade to the affected countries. Among huge collection of drugs manufactured here, one of the anti-malarial drugs, Hydroxychloroquine (HCQ) has caught the sight of the Covid infected countries. As India is the key supplier of affordable and high-quality HCQ, major economies, like the U.S. are eyeing on it for drug supplies causing it to ramp up its production activities. Moreover, drugs like paracetamols and ritonavir are also being massively exported to some of the infected nations. The onset of coronavirus has created a huge spike in the volumes of country’s pharma exports this year paving the way for it to be counted among the top three pharmaceutical markets in 2020 across the globe. Pharma Stocks Rally, Witness Unprecedented Gains As per the analysts, the stock market would see a major change in the country’s sectoral leadership with the entry of pharma companies at the top levels after the pandemic departs. They believe that the situation may become a game-changer for the industry leaders who may find themselves not in the same position as now in the future. Analysis reveal that private banks, pharma and insurance sectors would dominate the markets in the coming years giving way to heavy investments in these sectors. Appolo Hospitals Pharmaceutical Exports From India (US$ Billion) 20 18 16 14 12 10 2012 2013 2014 2015 2016 2017 2018 2019 2020 Source: IBEF Company Name EBITDA (Q4FY20E) Change (%) Y-o-Y 7.6 Q-o-Q (-)5.9 Aurobindo Pharma Biocon Cadila Healthcare IPCA Labs Sun Pharma 1136.9 467.9 799.4 252.2 1710.0 390.9 16.1 (-)0.1 54.2 68 33.1 5.3 15.3 (-)7.8 (-)7.1 (-)9.1

3. Pointers for Indian pharmacists and health care experts to seek opportunity during coronavirus: 1.Pharma companies have a golden chance to grab the opportunity and cast aside sourcing from China and perform well by gaining the trust of its international players. 2.Crash in raw materials can be seen as an opportunity to make the country self-reliant in manufacturing API and drugs. 3.Healthcare sector is likely to witness strong gains with 5G technology promising to revolutionize healthcare including diagnostics and real-time interaction between doctors and patients. 4.India can envision itself as a world leader as UNICEF and UNITAID show strong reliance on generic drugs manufactured in India for their healthcare programs. Industry Research International Plant Shutdowns •Borealis Chemicals Announced Force Measure in its Steam Cracker Operations Borealis Chemicals, a chemical manufacturing company in Austria, has declared force measure in its stream cracker plant in Stenungsund, having a capacity around 650KTPA of Ethylene. The decision was taken at the back of a technical issue in the cracket unit. The company has already reduced operating efficiency in the Steam Cracker Plant due to demand destruction amid pandemic outbreak. Global Plant Resumptions •Lyondell Basel Restarts Operations in its FCC Units Lyondell Basell, a multinational company dealing in chemical manufacturing and distribution has announced restart in its plant operations in FCC unit of the refinery located in Houston Ship Channel. The FCC unit was shut in mid-February at the back of a sudden fire outbreak caused. The refinery in Houston has an installed capacity of about 263.7K bbl/day. •India Glycol Limited Commences Restart in its Chemical Production India Glycols Limited, renowned as an only green petrochemical company has resumed operations in several manufacturing facilities that were formerly shut in response to preventive measures of coronavirus outbreak. As of now, production has been initiated in plant manufacturing chemicals and ancillary products located in Kashipur (Uttarakhand), a distillery unit in Gorakhpur (U.P) and another chemical plant in Selaqui-Dehradun (Uttarakhand). •Hindustan Composites Resumes Production at Aurangabad Plant Facility Hindustan Composites, a downstream chemical company engaged in the manufacturing of industrial sealing, friction materials and safety products has announced restart in operation at its Paithan Plant in Aurangabad. Plant Operations at Hindustan Composites were primarily shut from March 23 in compliance to the government norms to constrain Coronavirus in the country. Mergers and Acquisitions •GP Global Acquires Lubricant Business of Grand Petroleum Gulf Petroleum Group, a company engaged in the mid-stream and downstream segments of petrochemical industry has announced acquirement of lubricant business of Grant Petroleum. The deal includes assets such as HiSpeed Lubricant Brand and storage tanks having 6000 kilolitres of capacity in addition to the blending plant with 50KTPA capacity in Lagos. Supporting the acquisition, GP Global COO stated that it will help the company to expand its oil as well as agricultural products business segments in the global market.

4. Strategic Investments •SA Water to Construct Solar Farm on Former Fossil fuel Asset SA Water entered into an agreement to acquire 14 hectares of land at a former refinery of ExxonMobil to construct solar farms as a project under in response to the utility’s push to a “zero cost energy future”. The project comprises over 150MW of solar circuits across various sites along with battery storage of 34 megawatt hours. The plant site is anticipated to witness a complete renewal in all its facilities with an aim to serve the environment by reducing carbon emissions. Get the Chemical and Petrochemical Industry News on Daily Basis, Weekly-Trend & Forecast and Monthly-Analyst Views Subscribe Today! News on WhatsApp/WeChat/Mail First 15 days free news WhatsApp No. +91-9914868686 For sales related query, dial +91-9958299626 or email at sales@chemanalyst.com About ChemAnalyst About ChemAnalyst ChemAnalyst is ‘one stop’ online portal that offers comprehensive market intelligence data and in-depth analysis on the Indian chemical and petrochemical industry. Our aim is to provide competitive advantage to the industry stakeholders by offering ‘cutting edge’ information and analysis that help our customers leverage on the emerging opportunities in their businesses. ChemAnalyst’s team of 100+ analysts are engaged in tracking Chemical Prices daily, production capacity, demand and supply outlook, manufacturing plant locations, foreign trade data and news/deals for more than 400 major chemicals produced in India. ChemAnalyst’s Interactive subscription platform provides the most comprehensive data and analysis in your industry to help you decide the future. ChemAnalyst is promoted by TechSci Research (TSR). TSR is an award winning research based management consulting firm providing market research and advisory solutions to the customers worldwide, spanning a range of industries including Chemicals & Material, Automotive, Consumer & Retail, ICT, Energy & Power, Aerospace & Defense, Water and Waste Management, BFSI and more. For more information, please visit us at www.chemanalyst.com