Shukra Pharmaceuticals Ltd Management Discussions

Shukra Pharmaceuticals Limited is a public limited company with a strong global outlook, engaged in the manufacturing, marketing, and export of pharmaceutical formulations. The Company caters to both domestic and international markets, with a growing presence in countries such as Australia, Uganda, Kenya, the United Kingdom, Sri Lanka, Mauritius, and the Republic of Yemen. Our commitment to delivering quality pharmaceutical products has earned us the continued trust of clients across these geographies.

Operating in the highly competitive Indian pharmaceutical industry, which comprises more than 20,000 manufacturing units, Shukra Pharmaceuticals has carved out a distinct identity. The Company has built a formidable reputation backed by its robust research and development capabilities, state-of-the-art manufacturing infrastructure, and a deep understanding of both Indian and international regulatory environments and market demands.

Over the years, Shukra has partnered with reputed global pharmaceutical companies to develop and manufacture a wide range of drugs, dosage forms, and potency variations. These collaborations have strengthened our technical know-how and enhanced our ability to respond quickly and effectively to evolving market needs.

The Companys strategic focus remains on maintaining the highest standards of quality, operational efficiency, and innovation in product development. With a dedicated emphasis on regulatory compliance, research-driven manufacturing, and expanding global outreach, Shukra Pharmaceuticals continues to strengthen its position as a trusted pharmaceutical partner across diverse markets.

INDUSTRY STRUCTURE AND DEVELOPMENT

The Indian pharmaceutical industry continues to be recognized globally for its strong capabilities in manufacturing excellence, cost-effective product development, and process innovation. These competitive advantages have positioned India as one of the largest suppliers of generic medicines worldwide and a key contributor to global healthcare.

However, in recent years, the industry has encountered several challenges. Regulatory tightening in key export markets, pricing pressures, and supply chain disruptions have collectively moderated growth, bringing the Compound Annual Growth Rate (CAGR) to approximately 7 8%. Domestically, the sector also faces evolving compliance standards, increased competition, and changing healthcare dynamics.

Despite these headwinds, the long-term growth potential of the pharmaceutical industry remains robust. Emerging therapeutic areas, the expansion of healthcare infrastructure in developing countries, increased penetration of health insurance, and a growing focus on wellness and preventive care are expected to fuel demand. Moreover, the shift towards value-added formulations and biologics presents new frontiers for growth.

For Shukra Pharmaceuticals Limited, these developments offer opportunities to expand its footprint in regulated and semi-regulated markets, diversify product offerings, and enhance strategic collaborations. The Company remains committed to leveraging its strengths in quality manufacturing, R&D, and regulatory compliance to capitalize on these emerging trends and contribute meaningfully to both domestic and international healthcare ecosystems.

OPPORTUNITIES:

1.Government-Supported Healthcare Coverage and Expanding Domestic Demand

One of the most significant developments shaping the Indian pharmaceutical market is the continued focus on universal healthcare through government-led initiatives such as the Ayushman Bharat Pradhan Mantri Jan Arogya Yojana (AB-PMJAY). This national health protection scheme is expected to benefit more than 10 crore low-income families, accounting for nearly 50 crore beneficiaries, or approximately 40% of Indias population.

This initiative aims to provide access to free healthcare services, including hospitalization and drug access, thereby expanding the volume-driven demand for essential and chronic medications. The pharmaceutical industry stands to benefit from this massive coverage expansion, particularly companies like Shukra Pharmaceuticals that focus on affordable, high-quality formulations. The scheme also contributes to increasing health insurance penetration, which in turn boosts prescription drug volumes and organized healthcare consumption.

2.Growing Burden of Chronic Diseases and Demand for Specialized Drugs

Indias healthcare landscape is witnessing a shift in disease patterns, moving from communicable diseases to non-communicable and chronic illnesses such as diabetes, hypertension, cardiovascular disorders, and cancer. These conditions require long-term treatment plans and continuous medication, unlike acute illnesses.

This shift is expected to create substantial demand for specialty and chronic care medications, which are typically more expensive. Indian pharmaceutical companies, with their cost-effective manufacturing capabilities, are ideally placed to bridge the affordability gap in these high-growth therapeutic segments.

At Shukra Pharmaceuticals, we recognize the need to align our product development and capacity planning with the chronic disease burden and are evaluating new formulations, dosage variations, and therapeutic class expansion in chronic disease segments to better serve this growing market.

3.Innovation in Biosimilars, Gene Therapy, and Specialty Drugs

Historically, the success of Indias pharmaceutical industry has been driven by its dominance in the generic drugs segment. However, future growth is expected to come from next-generation therapeutics, including:

Biosimilars: Complex biological products that are similar to already approved biologic drugs. Gene Therapy: Cutting-edge treatments that target genetic disorders. Specialty Drugs: Targeted therapies for specific conditions like oncology, autoimmune diseases, and rare disorders.

India was one of the first markets to introduce biosimilars, with Reditux (a biosimilar to Rituximab) launched by Dr. Reddys Laboratories in 2007. However, development at scale in advanced biologics remains limited, owing to infrastructure and regulatory challenges.

That said, the global biosimilars market is expected to exceed USD 60 billion by 2030. If the Indian pharmaceutical sector can capture even 10% of this market, it could result in industry-wide growth of over 13% CAGR in the coming decade.

To seize these opportunities, pharmaceutical companies will need to make long-term investments in R&D and advanced manufacturing, with gestation periods of 8 to 10 years. A supportive domestic regulatory and investment environment, including facilitative policies from the Department of Biotechnology and faster drug approval mechanisms, will be essential to drive innovation and competitiveness in these segments.

Shukra Pharmaceuticals is exploring partnerships and technology collaborations to position itself in the biosimilar and specialty drug space over the medium to long term, with a focus on scalability and global regulatory readiness.

4.Expanding Export Horizons to Underpenetrated Global Markets

While India is already a global leader in pharmaceutical exports especially to the United States and African nations there remains significant untapped potential in large and underpenetrated markets such as:

Japan: Valued at over USD 85 billion, yet Indian companies have less than 1% market share.

China: Offers access to one of the worlds largest and fastest-growing pharma markets.

Indonesia, Africa, and Latin America: Countries with rising healthcare needs and limited domestic manufacturing.

Penetration into these markets will require:

Localized strategies: Including partnerships with in-country distributors and manufacturers. Compliance with complex regulatory regimes: Especially in Japan and China. Customised product portfolios: Adapted to regional therapeutic needs and pricing dynamics.

To tap into these opportunities, Indian pharmaceutical companies will also require government support in terms of trade diplomacy, harmonization of standards, and streamlined export procedures.

Shukra Pharmaceuticals has already established a footprint in select international markets, including Australia, Kenya, Uganda, Sri Lanka, Mauritius, the United Kingdom, and the Republic of Yemen. The Company is actively evaluating expansion into East Asian and Latin American markets, supported by its strong record of GMP-compliant manufacturing and formulation capabilities.

The global pharmaceutical landscape is undergoing a paradigm shift, driven by demographic trends, regulatory evolution, and technology-led transformation. In this context, Shukra Pharmaceuticals Limited is well-positioned to capitalize on emerging opportunities across the value chain from domestic demand expansion and chronic care to biosimilars, gene therapies, and new international markets.

The Company remains committed to Investing in R&D and innovation, ensuring quality-driven manufacturing, and forging strategic partnerships to enhance reach and capabilities.

These efforts are expected to drive sustainable and profitable growth over the coming years, contributing to both shareholder value creation and broader access to affordable healthcare.

CHALLENGES:

Despite the tremendous growth potential and strategic advantages enjoyed by the Indian pharmaceutical sector, the industry continues to grapple with a range of structural, regulatory, and economic challenges. For Shukra Pharmaceuticals Limited, addressing these challenges is critical to maintaining long-term resilience and competitiveness in both domestic and global markets.

1.Limited Access to Universal Healthcare

Indias healthcare infrastructure, though improving steadily, remains inadequate relative to the size of its population. According to recent data, India has only 29 skilled health professionals per 10,000 people, compared to 41 in China and 111 in the United States. While this meets the World Health Organizations minimum threshold of 23 healthcare workers per 10,000, India would still need to add nearly 1.5 million professionals a 42% increase to reach parity with China.

This shortage of trained medical personnel, especially in rural and semi-urban areas, continues to hinder healthcare delivery. It poses a challenge for pharmaceutical companies, as access to healthcare professionals directly affects diagnosis rates, prescriptions, and treatment compliance, thereby impacting demand for medicines.

Shukra Pharmaceuticals acknowledges the importance of bridging last-mile access and supports policy measures to expand healthcare infrastructure and personnel, which would directly benefit medicine consumption across underserved geographies.

2.Low Public Healthcare Spending and Affordability Issues

Indias public health expenditure stands at approximately 1% of GDP, significantly lower than the 2.5% to 3% of GDP spent by peer nations such as China, Thailand, and Malaysia. This underinvestment results in limited public health services, with less than one-third of the population having health insurance coverage. Consequently, a majority of citizens are left to bear their medical expenses out-of-pocket, often leading to a trade-off between health needs and basic necessities.

This affordability barrier has direct implications for drug access and compliance, especially for chronic disease treatments, which require prolonged and continuous medication. The situation demands innovative delivery models and digital health interventions that can improve access at lower transactional costs, particularly in resource-constrained settings.

3.Regulatory and Pricing Uncertainty

One of the most persistent challenges for pharmaceutical manufacturers in India is the lack of a stable pricing and policy environment. Frequent and ad hoc changes to drug pricing regulations, such as those governed by the National List of Essential Medicines (NLEM) and the Drug Price

Control Order (DPCO), create uncertainty and risk in long-term investment planning, R&D efforts, and product launches.

While affordability is a key policy priority, there is a pressing need for a balanced and consultative regulatory framework that safeguards both public interest and industry viability. Collaborative engagement between the government and industry stakeholders is essential to devise a transparent, predictable, and equitable pricing structure, which incentivizes innovation while ensuring affordable access for all.

Shukra Pharmaceuticals advocates for stable and forward-looking pricing policies that promote market predictability, enabling pharmaceutical companies to invest in capacity expansion, research, and differentiated product development.

4.Global Economic and Geopolitical Headwinds

The financial year 2024 25 witnessed a resurgence in global economic activity, particularly in emerging markets, driven by higher investment spending. However, macroeconomic uncertainty continues to loom in certain parts of Europe and other geographies, due to fiscal imbalances, inflationary pressures, and volatile commodity prices.

These global factors have a ripple effect on the Indian pharmaceutical industry, particularly for exporters like Shukra Pharmaceuticals. Currency volatility, logistical disruptions, and regulatory divergence in various countries continue to challenge cost structures and market entry timelines.

While the Indian economy is forecasted to grow at 7.4%, inflation and rising global input prices, including APIs and packaging materials, are impacting margins and operational costs across the sector. Companies must focus on cost optimization, diversification of supplier base, and financial prudence to remain competitive in this volatile environment.

5.Industry Consolidation and Competitive Pressures

The year also saw an uptick in M&A activity, with Indian pharmaceutical companies increasingly being acquired by multinationals or entering into joint ventures. While this signifies confidence in Indias manufacturing and scientific capabilities, it also intensifies competitive pressures for homegrown mid-sized companies.

Additionally, as many players turn their focus toward semi-urban and rural markets for incremental growth, market saturation and price competition in generic formulations are expected to rise. For companies like Shukra Pharmaceuticals, differentiation through niche formulations, quality compliance, and service excellence will be key to maintaining market share.

As Shukra Pharmaceuticals Limited navigates the complex regulatory and operational landscape of the pharmaceutical industry, it remains focused on addressing these challenges through strategic investments in technology and automation, deepening market penetration via affordable and high-quality medicines, maintaining regulatory discipline and compliance, and pursuing innovation-led partnerships in emerging therapeutic areas.

While the operating environment poses certain headwinds, Shukra Pharmaceuticals is confident in its ability to adapt, innovate, and thrive delivering value to patients, healthcare providers, and stakeholders across the value chain.

STRENGTH:

Shukra Pharmaceuticals Limited has consistently leveraged its core strengths to establish a firm position in the highly competitive pharmaceutical industry. Our capabilities in quality manufacturing, global regulatory compliance, and diversified exports continue to be key drivers of our sustained growth and market relevance. During the Financial Year 2024 25, the Company further reinforced its foundational strengths, which are outlined below:

1.Technocrat-Led Management with Practical Expertise

The Company is promoted and led by a team of highly competent technocrats who bring deep domain expertise, hands-on industrial experience, and a strategic outlook to pharmaceutical manufacturing and global operations. The promoters have extensive practical exposure across key areas such as formulation development, regulatory affairs, quality assurance, plant operations, and international business development. Their commitment to excellence and ethical governance continues to guide the Companys expansion strategy and innovation roadmap.

2.WHO-GMP Certified Manufacturing Since 1998

Shukra Pharmaceuticals Limited has been WHO-GMP certified since 1998, a recognition that validates our compliance with stringent international manufacturing practices. The Company has maintained consistent adherence to Good Manufacturing Practices (GMP) as defined by the World Health Organization, ensuring that all products meet globally accepted standards of quality, safety, and efficacy.

Our manufacturing infrastructure is regularly audited and upgraded to remain aligned with evolving regulatory expectations. This long-standing WHO-GMP compliance has also enabled us to build trust among international buyers, health ministries, NGOs, and regulatory agencies across multiple countries.

3.Global Expansion and Diversified Export Presence

With a clear vision of becoming a globally trusted pharmaceutical partner, Shukra Pharmaceuticals Limited has progressively expanded its geographical footprint. During FY 2024 25, the Company continued its efforts to strengthen presence in international markets including:

Africa: Uganda, Kenya, Mozambique, Mali, Republic of Guinea Asia: Sri Lanka, Thailand, Singapore Europe: United Kingdom, Denmark North America: United States of America, Canada Middle East: Dubai Oceania: Australia and Pacific Island nations

In addition to direct exports, the Company also supplies to international merchant exporters who further cater to diverse markets. For example:

Our U.K.-based export partners supply to Senegal and Ghana Denmark-based buyers participate in NGO-driven healthcare tenders

Australian partners serve the Pacific Islands, including Papua New Guinea, Kiribati, Solomon Islands, Tonga, and Thailand Singapore-based exporters cater to Ukraine, Poland, and Sudan

This broad export strategy allows the Company to diversify risk, tap into emerging markets, and customize offerings for varying regulatory and patient needs.

4.Skilled Human Capital with Technical Proficiency

Our strength lies in our team of highly qualified and experienced professionals, who bring with them a wealth of expertise in formulation science, analytical research, production engineering, regulatory compliance, and international marketing. The Company fosters a culture of continuous learning, ensuring that the workforce remains up to date with global technical advancements, automation practices, and industry innovations.

Our cross-functional teams collaborate seamlessly to drive efficiency, quality, and speed to market, making Shukra Pharmaceuticals a responsive and reliable partner for clients and institutions worldwide.

The strengths of Shukra Pharmaceuticals Limited rooted in technical leadership, internationally certified manufacturing, global outreach, and a capable workforce form the foundation for the Companys sustained growth and strategic evolution. As we continue to scale new heights in FY 2025 26, these enduring capabilities will remain central to delivering value to our customers, stakeholders, and global healthcare systems.

OVERALL REVIEW OF COMPANY

Product Portfolio

We are providing variety of products to the clientele. Currently the product portfolio includes followings:

Antibiotics (Penicillin), Anti Biotics (Cephalosporin), Anti Biotics, Macrolides, Quinolones, Anti Bacterial, Anti Fungal, Anti Malarial, Anti Viral, Anti Protozoal, Anti Anthelmintic, Sedative and Tranquilliser, Anti Depressant, Anti Manic, Anti Emetic, Anti Ulcer, Beta Blockers, Diuretics, Analgesic, Analgesic (NASID), Muscle Relaxants, Anti Tuberculosis, Vitamin Products, Anti Allergics, Corticosteroids, Hyper and Hypoglycemic, Others Customers satisfaction by delivering quality products has been the corner stone of our Company. The Company, therefore, believes in manufacturing of all critical and precision components in-house.

Manufacturing Activities

The formulation facilities are spread over 10 Acres of sprawling green campus. The companys manufacturing plant is situated in the district Gandhinagar, Rakanpur.

Company has highly experienced, highly qualified, highly dedicated professionals continuously updated with the latest technical and technological advances, manufacturing innovations and product standards in the field.

A singular reason why Shukra Pharmaceuticals continues to be the choice of people who value production efficiency, Safety, high output, economy and quality. For Shukra Pharmaceuticals contract manufacturing is a strategic partnership, from development to scheduled delivery. The Manufacturing practices are directed to ensure better utilization of capacities, investments in the latest.

OPPORTUNITIES, THREAT, RISKS AND CONCERNS

The Indian pharmaceutical industry is growing consistently and is expected to do so also in future. Quality of products will improve, as is evident from the recent publication of the new Indian Pharmacopeias and the activities of the Drugs Controller of India against “irrational combinations” and “counterfeits”. We wish that these initiatives, which will lead to a safer healthcare environment for patients, will be followed up in a transparent and rational way.

Over the past decade, pharmaceutical companies have entered a difficult period where shareholders, the market and regulators have created significant pressures for change within the industry. The core issues for most of drug companies are declining productivity of in-house R & D, patent expiration of number of block buster drugs, increasing legal and regulatory concern, and pricing issue. As a result larger pharmaceutical companies are shifting to new business model with greater outsourcing of discovery services, clinical research and manufacturing.

Today Indian pharmaceutical Industry can look forward to the years to come, with great expectations. There are opportunities in expanding the range of generic products as more molecule come off patent, outsourcing, and above all, in focusing into drug discovery as more profits come from traditional plays. At the same time, the Indian Pharma Industry would have to contend with several challenges particularly the

Effects of new product patent Drug price control Regulatory reforms Infrastructure development Quality management and Conformance to global standards.

FUTURE OUTLOOK:

Being satisfied with the infrastructure of the company Mr. Dakshesh Shah, Director is gearing up to obtain ISO 9000 Certificate in view of the liberalization of economic policy of the country. This will provide an ample and unique opportunity for the further growth of the company.

Visualizing a meteoric all-round growth of Pharmaceutical Industry in India and abroad Shukra has set up a sophisticated injectable plant being fully committed by continuous improvement with its sound R&D base.

Further to attain financial strength through ever growing profitability to attain excellence while achieving "Supreme customer satisfaction" to attain the global recognition for the corporation and to focus on customers need and fulfill their expectations.

SEGMENT WISE PERFORMANCE

The Company is operating only in two sector i.e. pharmaceutical and Laboratory. But during the year the laboratory segment has commenced very minor commercial operation and therefore the segment reporting and performance standard is not applicable to the Company.

FINANCIAL PERFORMANCE

The Company is passing through the restructuring process and trying to come out of all difficulties by improving its turnover.

The Company has diversified its business activities and at the verge of achieving better financial performance. The Company has successfully implemented various operational excellence programs designed with the help of external consultants so as to optimize on cost and delivery commitments. The Companys cash flow position as at the yearend continues to remain strong. Increased liquidity has strengthened the Companys confidence for launching new growth initiatives for the existing and emerging businesses of construction.

Details of significant changes (i.e. change of 25% or it. more as compared to the immediately previous financial year) in key financial ratios, along with detailed explanations thereof, including:

Sr.	Financial Ratio	Year ended
No.		31.03.2025	31.03.2024
1.	Debtors Turnover	1.96	2.73
2.	Inventory Turnover	1.32	5.15
3.	Interest Coverage Ratio	-	-
4.	Current Ratio	3.79	3.97
5.	Debt Equity Ratio	0.07	0.05
6.	Operating Profit Margin (%)	-	-
7.	Net Profit Margin (%)	29.42	24.86

Notes: -

Debtors Turnover ratio increased due to good collection of receivables.

Inventory Turnover ratio decreased due to as on date Closing stock Inventory is more than the average increase in sales compared to the previous year.

Debt Equity Ratio decreased mainly due to decreased in Debt fund compared to Shareholders Fund.

Net Profit Margin (%) increased due to increase in Net Profit and increase the Total Revenue of the Company in Current financial year as compared to previous financial year.

INTERNAL CONTROL:

The Internal Control systems including the policies, procedures and guidelines of the Company are adequate and commensurate to the extent and nature of its operations. The controls are reviewed for effectiveness by the internal auditors and the audit committee too. Any deviations are brought to the notice of the Audit Committee periodically and corrective steps are recommended and implemented.

Date: 30/08/2025	By Order of the Board of Directors
Place: Ahmedabad	For Shukra Pharmaceuticals Limited
	Sd/-	Sd/-
	Dakshesh Shah	Payal Mehta
	Managing Director	Director
	DIN: 00561666	DIN: 02145421