Probe42 - Probe Information Services

Information on Indian companies
Probe42 Industry Insights – Pharmaceuticals

The Indian pharmaceutical industry is set for significant growth, with a projected CAGR of over 10%, expected to reach US$130 billion by 2030.

Probe42 provides comprehensive data on more than 22,000 pharmaceutical businesses in India.

Indian pharmaceutical incorporations trace back to the 1900s, showing consistent growth till the 1970s, and a significant spike since the 2000s, with over 1000 new incorporations annually since 2015.

Dive into the dynamic world of Indian Pharma with our Industry Insights series, covering geographic distribution, financial insights, and revenue breakdown in key pharmaceutical sectors, including Pharma Retailers and Distributors, Formulations, API Manufacturers, Contract Research, and Animal Pharma.

Key Highlights:

🔸60% of secured loans in the industry stem from Maharashtra, Telangana, Gujarat, and Delhi
🔹 Over 50% of pharmaceutical companies have not initiated any secured loans, with the majority having a total sum of <=₹1 Cr in secured loans.
🔸 Majority of Pharma retailers, distributors, and Formulation companies have secured borrowings <=₹1 Cr, while API Manufacturing companies typically range between ₹25 Cr- 100 Cr.
🔹 Annual revenue of pharmaceutical companies spans from as low as ₹1,000 to as high as ₹20,000 Cr.
🔸 Foreign currency earnings in the industry can reach up to ₹8,000 Cr, whereas foreign currency expenses total around ₹800 Cr.

 

 

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About Probe42

  • Probe42 is an independent information services company that specializes in offering financial information on unlisted Indian companies.
  • Our platform has been widely utilized by banks and corporations to aid key processes like business development, credit analysis, KYC and competitor analysis.
  • Access over  1.9 Million Active companies, with 500+ Data points on each company, curated from 746 verified data sources on a single platform.
Launching The Probe Score: A Revolutionary Financial Risk Assessment Tool

Simplify Risk Assessments with the Probe Score

Assessing a company’s creditworthiness traditionally demands meticulous and time-consuming analysis. It often relies on the expertise of financial analysts and involves a comprehensive review of financial performance, historical data, and macroeconomic indicators.

Key Challenges in B2B Decision Making:

  • Time-Consuming  • Individual-Dependent  • High Cost  • Lack of Standardization

Introducing the “Probe Score” – a game-changing tool that enables instant assessment of a company’s financial strength based on our proprietary scoring system.

 

The Probe Score - At A Glance

 

What is the Probe Score?

The Probe Score is a numerical representation of a company’s Financial Strength. It incorporates the company’s financial performance over the past three years, the strength of its balance sheet, and how it compares to similar-sized peers.

It is a statistical score is automatically calculated by the system, offering users valuable insights into the potential risk associated with engaging with a particular company.

How is the Probe Score rated?

The Probe Score is rated on a scale from 1 to 5. A Probe Score of 3, 4, or 5 signifies that a company is financially sound. Falling within the 3 to 5 band places the company in the “green zone,” indicating a lower risk when engaging with this company.

Furthermore, each of the 5 key financial factors that are used to calculated the score, is individually rated on a scale from 1 to 5. This approach provides users with insights into both the overall financial strength of the company and its performance on each of these essential factors.

Probe Score -Rating Table

While the Probe Score provides a valuable snapshot, it’s advisable to review the underlying data of the company on the Probe42 platform for a comprehensive understanding of the company’s profile.

 

What is the Methodology Behind the Probe Score?

The Probe Score is the result of a sophisticated model meticulously crafted by credit risk and data science experts with a collective experience of over 100 years in fields such as credit rating, credit risk, and data science.

This score is the outcome of applying well-established statistical techniques to an extensive dataset comprising several hundred data features from over half a million Indian corporates over the past 6 years. It’s a proprietary score calculated by the system based on the latest information available within the Probe42 platform.

 

What factors go into the Probe Score?

Probe Score is calculated using five critical parameters:

  1. Profitability
  2. Liquidity
  3. Solvency
  4. Efficiency
  5. Growth

Probe Score - Core Factors and Methodology

Probe Score - Key Rations and allocation

 

What are the key Applications of the Probe Score for Financial Institutions?

The Probe Score is a valuable tool that provides users with a quick overview and initial assessment of a company. It aids in forming an early opinion on the company’s financial health and reliability. Here’s how it can assist you:

  1. Quick Assessment: Use the Probe Score to swiftly evaluate a company and form initial impressions.
  2. Prioritization Aid: The score is useful in prioritizing companies from a list you are evaluating, allowing you to focus on the most promising prospects.
  3. Streamlined Decision Making: Incorporate the numerical parameters of the Probe Score into your decision-making workflow to partly automate and expedite the prioritization process. This score enables faster and well-informed credit decisions, leading to significantly shorter loan application processing times.
  4. Portfolio Monitoring: Utilize the Probe Score for ongoing portfolio monitoring, helping you identify actionable insights and make informed decisions. With its comprehensive insights into the financial health of companies, the Probe Score enables institutions to proactively spot high-risk entities within their portfolio. Armed with this information, institutions can take strategic measures to mitigate risks.
  5. Enhanced Sales Conversion: The Probe Score efficiently evaluates companies’ financial health and risk, helping institutions target prospects with the best conversion potential. This approach weeds out unqualified leads upfront, enhancing the institution’s sales efforts.

Probe Score - Applications for financial Institutions

 

Where Can I Access the Probe Score?

To access the Probe Score for a company, follow these 4 steps:

  1. Login: Visit Banking.Probe42.in and log into your account.
  2. Enter Company Name: Enter the name of the company in the “Probe a Corporate” section.
  3. Navigate to Highlights Tab: Click on the “Highlights” tab.
  4. Access Probe Score: Within the “Highlights” content, click on “Probe Score” to view the company’s rating.

Make sure to refresh the data if the company has not been probed recently to ensure the information is up-to-date.

This highly anticipated feature is currently in limited release, If you would like us to activate this feature for you or your peers or have any suggestions, please feel free to contact us at support@probe42.in.

 

About Probe42

  • Probe42 is an independent information services company that specializes in offering financial information on unlisted Indian companies.
  • Our platform has been widely utilized by banks and corporations to aid key processes like business development, credit analysis, KYC and competitor analysis.
  • Access over  1.9 Million Active companies, with 500+ Data points on each company, curated from 746 verified data sources on a single platform.
Company Secretary using Probe42 to increase efficiency
From RoC Search Reports to Company Valuations: How Company Secretaries Can Leverage Probe42

“Why does it take so much time to prepare an RoC search report?”

“Is there an easy way to monitor companies where I provide Secretarial services?”

“Can I access and evaluate a company’s detailed legal history at a glance?”

As a Company secretary, these are some questions that might arise on a daily basis. If these resonate with you, discover how Probe42 can increase process efficiency, and reduce turnaround time.

 

Key Tasks

One of the most time-consuming tasks for company secretaries is preparing an RoC search report. With Probe42, this can be done at the click of a button, reducing the time and cost required to do a search report.

Key tasks such as Valuation, transfer pricing, NCLT & high court cases, business development, insolvency, and monitoring & consulting, are all possible on a single platform.

Valuation is made easier with peer comparison, securities allotment, and financials on unlisted companies. Transfer pricing is streamlined with instant access to the financials of all private companies and standardized formats that are widely used by banks and acknowledged by the RBI.

Improve Business development with lead generation from newly incorporated companies and LLPs, identifying companies due for auditor rotation, and tracking auditor details, their clients, and remuneration.

Access the detailed legal history of a company with a detailed summary of  NCLT & high court cases, including arbitration matters, corporate disputes, civil cases, criminal appeals, enforcement of orders, and taxation matters.

 

Insolvency proceedings of corporates can be overseen, cases filed by/against corporates can be explored, and preferential transaction audits can be conducted with Probe42.

Lastly, monitoring companies where you provide compliance services, assessing the compliance and financial risk of key customers & client suppliers, and 3rd party validation of information provided can all be done with Probe42.

 

About Probe42

  • Probe42 is an independent information services company that specializes in offering financial information on unlisted Indian companies.
  • Our platform has been widely utilized by banks and corporations to aid key processes like business development, credit analysis, KYC and competitor analysis.
  • Access over 28 Lakh companies, with 500+ Data points on each company, curated from 746 verified data sources on the Probe42 platform.

The MCA V3 Rollout
Probe42 Explainer – The MCA V3 Rollout

There has been a lot of conversation around the V2 to V3 migration by the Ministry of Corporate Affairs (MCA). We have created a brief explainer for you that provides an overview of the changes, as well as an associated timeline. We’ve also compiled a list of documents that are currently available on the V3.

The Ministry of Corporate Affairs is an Indian Government Ministry that is primarily responsible for enforcing the Companies Act 2013 and the erstwhile Companies Act 1956, the Limited Liability Partnership Act, 2008, and the Insolvency and Bankruptcy Code, 2016. It is in charge of regulating Indian enterprises in the industrial and service sectors.

What exactly are V2 and V3?

Companies in India file e-forms with the MCA for a variety of reasons, including Company Incorporation, Charge Creation/Modification, Directors/KMP’s Appointment/Resignation, address change, and so on. These e-forms were previously available as defined PDF forms that could be downloaded from the MCA website until Version 2 (V2). Users were required to download, fill out, and upload the appropriate e-forms to the MCA website.

In Version 3 (V3), webforms have replaced PDF-based e-forms. Users can choose their webforms and fill out the fields directly online, with added convenience, such as the ability to save a partially completed form and file it later.

While in V2, a “My Workspace” section with a list of notices from the MCA and circulars issued by them was available; in V3, there is a personalised “My Application” section which allows users to view all the forms filed by them, as well as the status of these forms such as – ‘Pending for DSC upload’,  ‘Approved’, ‘Under Processing’, etc.

Also, login in the V3 is possible via email ID than just a user ID. This allows for an OTP to be sent to the user’s mobile and e-mail address for increased authenticity.

Current Status

  • All LLP forms and the 65 company forms listed above have been moved to the V3 system, and will be available as web forms.
  • Migration of filled-in forms from V2 to V3: The MCA announced that all documents from V2 will eventually move to V3, and V3 to VPD. 

The View Public Documents (VPD) service

The MCA allows you to view the public documents of all registered companies/ LLPs through its View Public Documents (VPD) service. Users can view the public documents of a company/ LLP on payment of a fee.

  • The documents filed in V2, are all available in the VPD.
  • However, none of the filed V3 documents are currently available for viewing in the VPD.

Annexure

46 company forms made available in V3

Additional Resources https://www.mca.gov.in/content/dam/mca/pdf/SPICEplus-and-linked-filings-FAQs-V3-20230122.pdf

5 Key Ratios for Commercial Loan Underwriting

Over time, financial ratios have been used to quickly evaluate the financial and operational health of a company. Ratios are precise, yet elaborate enough in their own way.

Most of these ratios can be calculated through financial statements and then compared with industry benchmarks to get a broader understanding. For bankers, the interpretation of the ratio is far more critical than the computation. Validation of solvency and performance are the two essential characteristics of such financial ratios.

Selection of critical ratios is essential for bankers to access asset management, capital management, liquidity, risk, and profitability.

To make it easier we have listed five key financial ratios required for commercial loan underwriting:

5 Key Financial Ratios to Commercial Loans Undertaking - A detailed InfographicProfit Margin Ratio: This is a widely used profitability ratio, and it indicates the amount of profit generated over sales. This ratio measures the company’s ability to earn enough profit to sustain its business. Profit margins often vary from industry to industry, so, a prudent banker should always compare it with close competition and with the average industry standard.

Debt Ratio: This is a solvency ratio, which indicates the debt level of the borrower as a percentage of total assets. A lower debt ratio suggests more stable business and the higher is reverse. A ratio of 0.5 or less is considered as healthy, as this means the company has two times the assets as compared to liabilities. Anything more than 0.5 should be carefully examined before consideration.

Loan to Value (LTV) Ratio: This is a risk assessment coverage ratio that is very critical for mortgage underwriting. The LTV ratio ensures that the collateral is worth higher than the size of the loan. Higher the LTV ratio, more the risk involved.

Debt Service Coverage Ratio (DSCR): This is a liquidity ratio, which indicates the amount of cash generated by the business to service its debts (principal, interest, and leases). DSCR validates the borrower’s capacity to pay back the debt and keep running the business. DSCR between 1.25-1.5 is a relatively safe number to consider. However, it differs from business to business and depends on the risk aversion policies of the bank.

Net Worth to Loan Size Ratio: This ratio is used to compare the borrower’s net worth to the size of the requested loan. A high net worth indicates stable financial health, ultimately ensuring the repayment of the loan.

Ratio analysis is a proven technique to carry out quantitative analysis. However, financial ratios often vary across different industries and sectors, and comparisons between entirely different companies might not be advised.

So, it is advisable to examine industry peers through PEER COMPARISON to get more meaningful insights about the industry.

Use Probe42 to

  • Access key ratios by downloading financial statements in an excel format
  • Compare with peers in the same industry