“The narrative is very clear globally, that people want to move technology away from China, and we are hearing it more and more now. The US president-elect is also talking about this…So I think now it’s more of a bolder approach,” Poly Medicure’s managing director Himanshu Baid told Mint in an interview.
Similar to the past few years, Polymed expects 70% of its total revenue to come in from global markets, and 30% from India, a ratio Baid expects to continue for the next five years as well. The company recorded a consolidated revenue of ₹1,376 crore in FY24, with a net profit of ₹258.26 crore.
Shares of Poly Medicure traded 1% higher at ₹2,535.00 apiece on the BSE on Tuesday.
In addition to geopolitical shifts as countries look to move supply chains away from China, India’s medtech industry can leverage the country’s cost advantage – a lower cost of manufacturing on the workforce side, software and hardware talent as well as a growing electronics ecosystem – to boost exports, Baid said.
The Indian medtech industry was valued at $12 billion in FY24, and is projected to more than quadruple to $50 billion by 2030, according to a November report by EY. India’s exports of medical devices have risen at a compound annual growth rate of 14% from FY20 to FY24. Shipments from the country reached $3.8 billion in 2023-24, with the US as the primary market, accounting for 18% of India’s exports.
Still, India remains heavily import-dependent, with $8.2 billion in imports, and 80-85% of medical devices sourced internationally, according to the report.
Strides in US market
Polymed has a strong presence in highly regulated developed markets like Europe, Latin America, Southeast Asia and the US. About a third of its overall revenue comes from Europe, Baid said. The company is hoping to push deeper into the US market, amid geopolitical tailwinds.
This fiscal year, Polymed expects $2-3 million ( ₹17-25.5 crore) from its US business. The company aims to clock $15-20 million from its US business in the next 3-4 years. It has commercialised four US Food and Drug Administration-approved products, and hopes to receive approvals for more products to roll out in the US in the coming year.
The outgoing Biden administration in the US raised tariffs on Chinese medical products earlier this year. As president-elect Donald Trump prepares to take office in January, additional tariffs are likely on Chinese goods, which may bring business to India.
“We don’t have a big export play in medtech, unlike in pharma,” said Sujay Shetty, global health industries advisory leader at PwC, a consultancy. India’s pharmaceutical exports reached $27.9 billion in 2023-24, compared to $3.8 billion medtech exports in the same year. “How the tariffs situation for such exports will play out remains to be seen,” Shetty added.
Earlier this month, Trump reiterated his intention to impose reciprocal tariffs on India. However, this is not a cause for concern, according to Baid. “India has a tariff of around 10% on medical devices. So the reciprocal tariff can be only 10% in my view, number one. Number two, current tariffs on Chinese products range from 25% to 50%. So, there will still be a big gap,” he said in a post-earnings call with investors last month.
Domestic growth
The Delhi-based company, a leading medtech exporter, is also increasing its focus on the domestic market. Polymed registered a 22% year-on-year growth in its domestic business in Q2FY25. The focus is on adding segments that can be import substitutes, as well as increasing the headcount.
“For us, the model would be one-third revenue from India and two-thirds from global markets,” Baid said. While the India business is growing, “It’s not growing faster at the moment,” he said.
However, the company’s focus on adding more people to its domestic team – 100 this year and 100 in the next, as well as its foray into new segments is helping it expand at a faster pace in the domestic market, he said. Polymed has added two new segments – cardiology and critical care – this year.
Baid expects domestic manufacturing, especially for high technology products, to get a boost as the electronics ecosystem develops in the country. “We will be leveraging the electronics R&D ecosystem which is developing in the country…a lot of electronic parts and components have common usage,” he said.
This would make local sourcing of parts and components for medical devices easier. For instance, the company struggled with finding the right PCBs (printed circuit boards) and display screens for its dialysis machines being manufactured in the country, and had to import a lot of these parts. “Once we develop that part of the industry, it will have a trickle-down effect on the medtech industry also,” he said.
Earlier this year, the company raised ₹1,000 crore via a qualified institutional placement of shares, and will use ₹750 crore for organic growth and acquisitions. The company is looking closely at acquistions that would help them boost their tech capabilities, Baid said. “The focus is more on the technology side, either in India or outside India,” he said. “Today, to do anything new in medtech, you need four to five years to actually get all regulatory approvals, scale up manufacturing. To bridge this gap of technology, I think acquisition is the best way,” he added.
The company is looking at acquisitions in cardiology, critical care, and oncology segments.
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