Covid-19 vaccine manufacturers companies’ are in big demand worldwide. Among them, the Serum Institute of India(SII) is the largest vaccine manufacturer in the world. Now, in a recent report, SII has earned the maximum net margin among Rs 5000 crore revenue earned companies.
SII Earns Huge Margin
In 2019/20, SII has completed a net sale of Rs 5446 crore. Out of that, Rs 2251 crore is the net margin of SII. This margin is 41.3% of the total sale. No company has earned such a huge profit among all companies that had Rs 5000 crore sales.
Capitaline prepared a corporate database of 418 Indian companies that have a net sale of Rs 5000 crore and above. 41% earned by SII is a huge profit. It happened due to the exponential demand for covid vaccines. SII produces Covishield, a covid-19 vaccine. The formula of vaccine is developed by the UK with AstraZeneca name. In India, it was renamed Covishield.
In the list, maximum companies belong to Fintech, monopoly business sector, or pharma field. 18 pharma companies got featured in the Rs 5000 crore criteria. Macleods Pharmaceuticals ranks second with a 28% margin on total sales.
SII and the Indian government both go through heavy criticisms due to the current dire situation of India. Both parties did not have any plan to vaccinate Indians. Indian Government allowed SII to export the covid vaccine to other countries without reserving anything for India.
Recent SII Growth
SII is a subsidiary of Poonawalla Group that also has other business firms including real estate, finance, aviation, and horse breeding. SII revenue grew with a compound annual rate of 23% from 2008 to 2016. During these years, it earned Rs 4630 crore revenue with a net profit of Rs 2191 crore.
Serum Institute saw a decline in its revenue growth to 4% between 2016 to 2020. But profit margin stayed high.
Adar Poonawalla, CEO of Serum, talked about the manufacturing capacity of its firm in a recent interview. He said:
“The company expanded its annual manufacturing capacity from 1.5 billion doses to 2.5 billion and will increase it to 3 billion by October. In India, the question is how much, and how soon, can it supply to states. So far, in about four months, it has supplied a total of 150 million doses.”
How SII will supply the vaccine doses to India due to high demand. Serum Spokesperson said in a statement released on May 3:
“It will supply 110 million doses each to the Centre and states in “the next few months”.
But, it is not enough for India. The country requires 1.7 billion doses to vaccinate 850 million people above age 18+.
Why SII did not increase its manufacturing capacity? Answering this question, Adar told to NDTV:
“The company needed ₹3,000 crores, either from the Centre or banks, to reach monthly production of 100 million covid-19 vaccine doses.”
The company did not receive any such support from the Indian government.