INTRODUCTION TO BUSINESS

FINANCE REPORT
Financial analysis of pharmaceutical companies;
Ferozsons Pharmaceuticals and Abbott
Pharmaceuticals

GROUP:
SABIHA FATIMA 20221-31886
MAHA KHURSHID 20161-21015
MOHAMMAD IBRAHIM 20191-26520
ANZA ZAKI 20201-28028
FEROZSONS PHARMACEUTICALS (SABIHA AND MAHA) 3

ABOUT THE COMPANY 3

INTRODUCTION 3
OVERVIEW: 3
MISSION: 3
VALUES: 3
COMPETITORS: 4
BUSINESS SEGMENTS: 4
ADVANCEMENTS AND FUTURE PLANS: 4
CORPORATE GOVERNANCE ANALYSIS 4
CORE VALUES 4
CODE OF CORPORATE GOVERNANCE 4
RATIO ANALYSIS 6
CURRENT RATIO 6
QUICK RATIO 6
INVENTORY TURNOVER 6
AVERAGE COLLECTION PERIOD 7
TOTAL ASSET TURNOVER 7
DEBT RATIO 7
GROSS PROFIT MARGIN 8
OPERATING PROFIT MARGIN 8
NET PROFIT MARGIN 9
EARNINGS PER SHARE 9
RETURN ON TOTAL ASSETS 9
RETURN ON COMMON EQUITY 10
PRICE / EARNINGS RATIO 10
MARKET / BOOK RATIO 10
COMPANIES’ PERFORMANCE 12
LIQUIDITY: 12
ACTIVITY: 12
DEBT: 13
PROFITABILITY: 13
MARKET: 14
COMMAN SIZE ANALYSIS 15

ABBOTT PHARMACEUTICALS (IBRAHIM AND ZAKI) 16

ABOUT THE COMPANY 16

INTRODUCTION 16
DIRECT COMPETITORS: 16
INDIRECT COMPETITORS: 16
BOARD OF DIRECTORS 17
SWOT ANALYSIS 19
INTERPRETATION OF COMMON SIZING 25
INTERPRETATION OF RATIO ANALYSIS 26
INTERPRETATION OF RATIO ANALYSIS 27
INTERPRETATION OF RATIO ANALYSIS 27
INDUSTRY COMPARISON 28
INTERPRETATION 28

DETAILED ANALYSIS OF BOTH COMPANIES 29

RECOMMENDATION 30
WHAT DID YOU LEARN FROM THIS PROJECT? 30
 FEROZSONS PHARMACEUTICALS
(SABIHA AND MAHA)
ABOUT THE COMPANY
Introduction
The pharmaceutical industry is a very import part of the economy of Pakistan.
Specially now with regards to the global pandemic, this industry is the most vital for
any country to deal with the situation. In Pakistan there a many pharmaceutical
companies as well as distributers of international pharmaceutical companies.
Ferozsons laboratories and Searle company ltd are part of the top companies in the
industry.
Ferozsons Laboratories Limited was one of the first pharmaceutical companies of
Pakistan that was listed in the stock exchange as early as 1956. Since then, the
company has developed a strong financial track record. The company has grasped a
stronghold in a variety of specialized branches of medicine, prime examples include
Cardiology, gastroenterology and oncology. The company recently expanded its
manufacturing capabilities by adding a new production wing for solid dosage forms,
and it now provides principals with an excellent manufacturing, marketing, and
distribution platform for launching their products in the Pakistan market.

Overview:
• Ferozsons Laboratories Limited is a public limited company founded in the year
1960
• It is listed on the Pakistan Stock Exchange
• The market price of the company’s shares is currently at RS.322
• The total number of shares are +36m
• Partners such as the Bagó Group in Argentina, BioGaia of Sweden, Biofreeze of
Performance Health Inc., PanTheryx, Boston Scientific and Gilead Sciences, Inc.
in the USA.

Mission:
• We will strive to attain market leadership by putting patients first and seeing
every day as a new opportunity to earn trust and credibility

Values:
• Putting Patients First
 • Trustworthiness
• Collaboration
• Excellence

Competitors:
• Ferozsons Laboratories Limited is part of the highly competitive industry of
pharmaceuticals.
• Hence even with being in the top companies of the industry it still has
competitors;
• Searle Company, Abbott Laboratories Pakistan limited, Getz pharma, Pfizer
Pakistan limited.

Business segments:
• Pharmaceuticals
• Medical technologies
• exports

Advancements and Future plans:

• The company plans to expand in fields of Cardiovascular, Gastroenterology and
diabetes along with anti effectives.
• The Plan is to launch these products by mid or late 2021, totally depending on
market conditions at the time.

Corporate governance analysis

Ferozsons is aiming to be the market leader by prioritizing patients and viewing each
day as a new opportunity to earn trust and credibility. They want to improve people's
lives by offering innovative healthcare solutions and ensuring that patients have
access to high-quality treatment and cures. As a result, they will; increase stakeholder
and their value, increase the level of development of their workforce, collaborating for
excellence, and acting ethically and transparently.

Core values
They claim that the aim of their life and ultimate measure of success is to improve
people's lives. They strive to win the confidence of patients, healthcare professionals,
staff, business partners, and stakeholders every day. They believe that no one is
smarter alone but together they are unbeatable. They unite, collaborate, and triumph
as a team. They are dedicated to creating an environment of excellence and
consistently raising the bar.

Code of Corporate Governance

In light of the SECP Code of Corporate Governance, which is part of new Companies
Act 2017, public interest companies must have a women director. Ferozsons has three
female directors, which complies with the Code of Corporate Governance's
requirement for female members. Company and management information:
Board of Directors

• Mrs. Akhter Khalid Waheed (Chairperson/Non-Executive Director)

• Mr. Osman Khalid Waheed (CEO/Executive Director)
• Mrs. Amna Piracha Khan (Non-Executive Director)
• Mrs. Munize Azhar Peracha (Non-Executive Director)
• Mr. Shahid Anwar (Non-Executive Director)
• Mr. Arshad Saeed Husain (Independent Director)
• Mr. Suleman Ghani (Independent Director)

Audit Committee

• Mr. Arshad Saeed Husain (Chairman)

• Mrs. Amna Piracha Khan
• Mr. Shahid Anwar
• Mr. Suleman Ghani

Legal Advisors

• Khan & Piracha

Investment Committee

• Mr. Suleman Ghani (Chairman)

• Mr. Osman Khalid Waheed
• Mr. Shahid Anwar

Hr & Remuneration Committee

• Mr. Arshad Saeed Husain (Chairman)

• Mr. Osman Khalid Waheed
• Mrs. Munize Azhar Peracha
• Mr. Shahid Anwar

Company Secretary

• Syed Ghausuddin Saif

Chief Financial Officer

• Mr. Muhammad Farhan Rafiq

Head of Internal Audit

• Mr. Rizwan Hameed Butt

External Auditors

• KPMG Taseer Hadi & Co. Chartered Accountants

Internal Auditors

• EY Ford Rhodes Chartered Accountants

 Ratio Analysis
Current Ratio
Formula Current Assets / Current Liability

Years FL
2022 2.00
2021 2.45
2020 2.53
2019 2.91
2018 3.09

Quick Ratio
Total current assets – inventory –
Formula
prepaid expenses / Current Liabilities

Years FL
2022 0.96
2021 1.62
2020 1.33
2019 1.83
2018 1.84

Inventory Turnover
Formula COGS / Average Inventory

Years FL
2022 1.92
 2021 2.35
2020 2.11
2019 2.62
2018 2.10

Average Collection Period

Formula Account Receivable / Net / 365 days

Years FL
2022 55.63
2021 60.73
2020 64.77
2019 50.16
2018 37.35

Total Asset Turnover

Formula Sales / Total Assets

Years FL
2022 0.88
2021 0.87
2020 0.79
2019 0.85
2018 0.75

Debt Ratio
Formula Debt / Assets
 Years FL
2022 0.32
2021 0.28
2020 0.25
2019 0.20
2018 0.16

Gross Profit Margin

Formula Gross profit / sales

Years FL
2022 45.06%

2021 41.04%

2020 41.12%
2019 39.49%
2018 34.03%

Operating Profit Margin

Formula Operating profit / sales

Years FL
2022 12.45%
2021 14.25%
2020 10.89%
2019 8.53%
2018 4.95%
 Net Profit Margin
Formula Net income / sales

Years FL
2022 6.59
2021 10.31
2020 7.34%
2019 4.85%
2018 2.16%

Earnings Per Share

Formula Net income / Number of shares

Years FL
2022 14.19
2021 24.02
2020 13.11
2019 8.32
2018 3.16

Return on Total Assets

Formula Net income / Total assets

Years FL
2022 0.06
2021 0.09
2020 0.06
 2019 0.04
2018 0.02

Return on Common Equity

Formula Net income / common equity

Years FL
2022 10.28
2021 14.50
2020 7.91
2019 5.02
2018 1.91

Price / Earnings Ratio

Formula Share price / EPS

Years FL
2022 18.95
2021 24.87
2020 22.89
2019 13.47
2018 61.71

Market / Book Ratio

Formula Market capitalization / book value

Years FL
2022 26.90
2021 35.30
2020 30.00
2019 11.20
2018 19.50
 Companies’ Performance

Down below we will discuss the analysis of both the businesses using the financial
statements posted on their websites. We shall discuss their financial position on the
basis of their liquidity, liabilities, assets and profitability. The analysis will make it
easier for other companies to make a decision on choosing which company to invest
so that they receive back higher returns.

Liquidity:
When we check about the current ratio of SCL and FL we can clearly see that FL has a
higher current ratio which indicates a better liquidity. Having a better current ratio
indicates the possibility of the firm paying back its current liability on the basis of its
current assets.
However, on the other hand quick ratio of SCL is higher than FL and higher than 1 as
well which indicates better liquidity. Quick ratio indicates the firm’s ability of paying off
the current liabilities keeping in mind the quick assets. Since SCL has a better quick
ratio, SCL will not struggle with paying back their creditors.

2022 2021 2020 2019 2018

Current
Liquidity 2.00 2.45 2.53 2.91 3.09
Ratio
FL
Quick
0.96 1.62 1.33 1.83 1.84
Ratio

Activity:
Inventory turnover indicates which firm is converting its inventories into cash quicker
it indicates that the company is selling its good quickly. Since SCL has a higher
inventory turnover it indicates that they have better and higher sales.
A low inventory turnover indicates low demand for products hence less sales. Since FL
has a lower inventory turnover it indicates that they have weaker sales.
Average collection period indicates that the firm collects back its payments faster and
since FL has a lower average collection period, investors may consider investing in it
because there are higher chances of receiving back the investment.
Having a higher total asset turnover is better hence FL has an upper hand since it has
a higher total asset turnover. It indicates that FL will be more efficient at generating
revenue out of its assets.

2022 2021 2020 2019 2018

Inventory
1.92 2.35 2.11 2.62 2.10
Turnover
Activity Average
FL Collection 55.63 60.73 64.77 50.16 37.35
Period
Total Asset
0.88 0.87 0.79 0.85 0.75
Turnover

Debt:
Debt ratio shows the firm’s assets that are financed by debt. Having a 0.4 or less debt
ratio is beneficial for any firm as it indicates higher and better credibility. Since both
SCL and FL have a lower than 0.4 debt ratio, it is safe to say that both of them have a
good debt ratio however FLs debt ratio is slightly lower hence better than SCL.

2022 2021 2020 2019 2018

Debt
FL Debt Ratio 0.32 0.28 0.25 0.20 0.16

Profitability:
Gross profit margin tells us about the revenue that is left in an accounting period
hence proving that the firm performed well in dealing with its cost of sales. Having a
higher gross profit margin is preferable therefore, even though the difference is slight,
SCL will have an upper hand as compared to FL.
Operating profit margin tells us about the percentage of profit the firm has produced
from its functions hence having a higher operating profit margin is favorable. SCL
clearly has a way better operating profit margin as compared to FL hence the
investors may consider SCL above FL in this case. We can see the same pattern for
Net profit margin as well.
Earnings per share tells us about the profit a firm earned per share of stock hence
having a higher EPS is better because investors get back higher profits for their share.
Once again even for earnings per share, SCL has an upper hand due to a higher
average which means that the investors of SCL will get back high profits for their
shares.

2022 2021 2020 2019 2018

Gross Profit 45.06 41.04
41.12% 39.49% 34.03%
Margin
Operating Profit 12.45 14.25
10.89% 8.53% 4.95%
Margin
Net Profit Margin 6.59 10.31 7.34% 4.85% 23.62%
Profitability
FL Earnings Per 14.19 24.02
13.11 8.32 3.16
Share
Return on Total 0.06 0.09
0.06 0.04 0.02
Assets
Return on 10.28 14.50
7.91 5.02 1.91
Common Equity

Market:
The price / earnings ratio is mostly used for investors to check which firm has a higher
value stock of shares and it also helps them in taking a financial decision of investing
or not because it evaluates the stock price of a firm (undervalued or overvalued). FL
has a higher price / earnings ratio hence it gains an advantage over SCL.
The market / book ratio compares a firm’s current market price value to its actual
book value. In this case both the companies have a very similar market / book ratio but
SCL has a slightly higher market / book ratio as compared to FL.

2020 2019 2018

Price / Earnings 18.95 24.87
Market 22.89 13.47 61.71
Ratio
FL
Market / Book 26.90 35.30
30.00 11.20 19.50
Ratio
COMMAN SIZE ANALYSIS
 ABBOTT PHARMACEUTICALS
(IBRAHIM AND ZAKI)
ABOUT THE COMPANY
Introduction
Laboratories (Pakistan) Limited (the Company) is a public limited Company
incorporated in Pakistan on July 02, 1948. The Company is principally engaged in
manufacturing, importing, and marketing research-based pharmaceutical,
nutritional, diagnostic, diabetic care, hospital, and consumer products. Since 1948
Abbott has been helping people to live healthier lives through their products
including diagnostic tools, diabetes devices, nutrition-based products, and other
diverse ranges of medicines ensuring high-quality and lasting solutions. All this is
possible because their 14000 employees present in Karachi, Lahore, Peshawar,
Multan, and Rawalpindi Abbott understand that good health is the first step to living
the best life.
Everything they do is designed to help us do just that: their commitment to building
life-changing technologies that keep us healthy, nourish our body at every stage of
life, help us feel and move better, and bring us information, medicines, and
breakthroughs to manage our health. has created breakthrough products – in
diagnostics, medical devices, nutrition and Branded generic pharmaceuticals – that
help our family and community lead healthier lives, full of unlimited possibilities.
Today, 113,000 of employees are working to make a lasting impact on health in the
more than 160 countries they serve.

DIRECT COMPETITORS:
A direct competitor is a business that offers similar products or services to another
company within the same market. Products or services rendered by these
organizations can directly substitute another business' products or services.
Abbot's direct competitors include GSK, RECKKIT,Martin dow,Glasxosmithkline and
Searle.

INDIRECT COMPETITORS:
Indirect competitors are other options that customers have to purchase from you
that aren't direct competitors. This includes retailers such as supermarkets and
 vitamin stores that may offer lower-priced OTC products. Indirect competitors can
include Hakeems, natural remedies.

BOARD OF DIRECTORS
- EHSAN ALI MALIK Independent Director
Ehsan Ali Malik is part of the Board of Directors of Abbott Laboratories (Pakistan)
Limited. He is currently serving as Director on Board of Standard Chartered Bank
(Pakistan) Limited, National Foods Limited and Gul Ahmed Textile Mills Limited. He
is also serving as the Chief Executive of Pakistan Business Council. Previously he
was the Chief Executive Officer/Director of Unilever Pakistan Limited. He was also
a Director of Unilever Pakistan Foods Limited. Further, he had also served as the
Chief Executive/Director of Lever Chemical (Private) Limited, Lever Associated
Pakistan Trust (Private) Limited, Unilever Birds Eye Foods Pakistan (Private)
Limited and Sadiq (Private) Limited. His earlier international appointments covered
Unilever’s regional business in Sri Lanka, Egypt, Lebanon, Jordan, Syria and Sudan
as well as Unilever’s Head Office in UK. Ehsan is a Fellow of the Institute of
Chartered Accountants in England and Wales and an alumnus of the Wharton and
Harvard Business Schools.
- MUNIR A. SHAIKH Chairman
Munir Shaikh is currently Chairman of the Board of Directors of Abbott
Laboratories (Pakistan) Limited and also the Chairman of the Board of Directors of
Abbott India Ltd. These companies are listed with their shares quoted on Pakistan,
and Mumbai Stock Exchanges respectively. Mr. Shaikh has held several
management positions with Abbott in Asia, Middle East and the United States. He
was the Managing Director of Abbott Pakistan, Regional Manager, Caribbean based
in Puerto Rico, Director of Business Development based in Chicago, Vice President,
Middle East and Africa based in Dubai and Vice President Pacific, Asia Africa based
in Singapore. Mr. Shaikh is a Fellow of the Institute of Chartered Accountants in
England and Wales.
- SYED ANIS AHMED CEO
Syed Anis Ahmed is the Chief Executive Officer of Abbott Laboratories (Pakistan)
Limited. Previously, he has served as the Chief Financial Officer of Abbott Pakistan.
He has over 25 years of experience in senior commercial and finance roles where
he has provided his guidance and leadership across different functions. Anis is also
serving as the President of the American Business Council. He also remained a
member of the Executive Committee of Overseas Investors’ Chamber of Commerce
& Industry (OICCI) and the Chairman of Pharma Bureau where he played a major
role in highlighting different issues faced by the Pharmaceutical industry. He was
previously associated with A.F. Ferguson & Co. (a member firm of the PwC
network) and Philips Pakistan. Anis is a Fellow member of the Institute of
Chartered Accountants of Pakistan.
Independent Director Ayla
is a leading mergers and acquisition, advisory and governance expert with over two
decades of rich experience. She is Founder & CEO of Planetive, a sustainability
advisory platform and runs the advisory practice of Khalid Majid Rehman Chartered
Accountants as Managing Director, Financial Advisory Services. Ayla sits on many
local and global boards including Global Council of Association of Chartered
Certified Accountants-UK; In Pakistan she is Board Member of listed companies
including Siemens Pakistan; Abbott Laboratories (Pakistan) Limited; and Mari
Petroleum Company Limited. Ayla was part of the team that drafted Pakistan’s first
“Code of Governance for Public Sector Entities.
MOHSIN ALI NATHANI Independent Director
Director Mohsin has been serving as a President and CEO of Habib Metro Bank
since 2018. He is currently serving as a Director on the Board of I-Care Pakistan
and is the President of Swiss Business Council. Previously, he served as the CEO of
Standard Chartered Bank in Pakistan and the UAE, Country Head & Managing
Director of Barclays Bank Pakistan, as a Director at CDC, Kidney Center, and as a
trustee in the IBA Endowment Fund. Earlier in his career, he served in various
corporate and Islamic banking regional roles. Mohsin is an MBA from Institute of
Business Administration, Karachi.
 SWOT ANALYSIS
Major Opportunities
- New consumer trends.
- Due to the pandemic, Abbott has got a chance to cater unexplored markets and
customers.
- Green manufacturing can prevent exponential climate change.
- Introducing new technologies.
Major threats
- Tough Competition.
- Shortage of highly skilled laborers.
- Shortage of supply of new or innovative products.
- Imitation of the products.
Major Strengths
- Effective ‘go to market strategies’.
- Nice performance in new markets.
- High skilled Labor
- Automation of processes.
- Customer trust
Major Weaknesses
- High rate of days in inventory.
- Poor demand forecasting
- Huge workforce.
- Inefficient financial planning
INTERPRETATION OF COMMON SIZING
• Income has increased and throughout the period expenses were controlled and
there wasn’t a big difference. Their EPS has increased which means they have
earned more than what they have invested.
• In 2017 the earnings were 0 and after 5 years in 2021, the earnings increased as
the demand increased due to covid. This was the industry that boomed even
during covid hence meds got taken more the demand increased causing an
increase in sales which obviously didn’t affect the COGS being more as the sales
were more than COGS.
• The operating income is decreasing in terms of sales because they invested in
R&D.
• Interest expense also called finance cost is increasing because operating profit
is less because of inflation and economic downturn. When you take the loan you
pay interest.
• Receivables declined and went to minus because 2019-2020 covid was at its
peak and the power to pay off was less. It was getting difficult for the people to
pack back but then we see bad debts in 2021 were 0 which means it got better.
• They had lessened their short-term investments which was a good step so that
the company can have more cash
• AR turnover increased and the average collection period decreased which
means that we are getting the money back early
• In 2019 Inventory increased as they came to know about covid they had stocked
up because demand increased and also because the medicines related to covid
had a higher sales ratio as compared to the other medicines.
• Property equipment increased as they had invested in research and
development during covid.
• Lease also increased as they needed it during covid. Hence total liabilities
drastically increased as co had taken loans from banks and other sources to
survive covid and had taken loads because they wanted to invest in research
and development which later did not go to waste
• Retained earnings also increased by 34 31 which means that during covid they
had sold more medicines and there was a 3% increase hence increased
reserves.
• They didn’t invest much in equity as they wanted to minimize their risks,
especially during covid.
INTERPRETATION OF RATIO ANALYSIS
• Current ratio 2020 was more because of covid which proves that they did
well during covid and was the most
• Quick ratio 2020 was also the best which means assets were more than
liabilities
• Turnover assets increased which means there was an increase in sales
while our assets were increasing slowly.
• Inventory turnover is how quickly the sales is being converted into cash
which means how early were they earning the money hence as in 2020 they
were earning more and in a lesser period
• Fixed asset the non current asset were being converted late because they
had invested in machinery
• Net profit increased as co has made money
• Gross profit slightly decreased as COGS increased because of inflation
during covid
• Return on total equity means co was making more to what they invested
hence investing in research was a good sign
• ROA was the most also in 2020 because of covid as they had invested in R&D
• Share prices also increased from 631 to 727 as the Account receivables
increased.Specially due to covid there was a major increases from 450 in
2019 to 762 in 2020
• EPS increased co was making profit so per share price had increased as
well which means we are earning more on a share
EPS Price per share

2017 699
2018 27 631
2019 13 450
2020 46 755
2021 60 97
INTERPRETATION OF RATIO ANALYSIS
The highest return on assets was in 2021 and the lowest is in 2017 this means
Abbott is generating more profit by its assets in 2021.
ROE is the best in 2021 and lower in all other years but it is the lowest in 2017 which
was bad and means Abbott was not using its equity well enough to produce income.
The gross profit margin was the highest in 2017 which means Abbott was
performing well but it reduced again in 2019 because of inflation and dollar
fluctuation and is continuing to reduce
The net profit margin was also the highest in 2021 but low in all other years. A high
NP margin shows high profitability but in 2017 it is the lowest which is 0 which
means no profit was generated.

The operating profit margin is also the highest in 2021 when compared to all other
years and in 2018 it is the lowest which is 0.12 and it is not too good profitability for
the company.
. The current ratio is not below 1 in any year which means Abbott is out of danger.
However, it was the best in 2017 but then decreased again in 2018 and 2019. But
well, the company is able to pay its short-term debts and is out of danger.
MARKET CAP (000's)
44,724,773.97
SHARES
97,900,302

INTERPRETATION OF RATIO ANALYSIS

Quick ratios indicate the company’s ability to pay its current liabilities without
selling its inventory or receiving additional financing. It should be 1 or higher. But in
2020 it is 1.46 and in 2017 it was at 2.13. Abbott should try reaching it to 2 again
which will be good for the company to pay its current liabilities easily.
The asset turnover ratio tells us how efficiently the company is using its assets to
generate revenue. In 2020 it is the highest and from 2018 and 2019 it decreased with
a more margin which means Abbott is using its assets more efficiently now to
generate profit.
The best inventory turnover is between 5 and 10 but Abbott’s Inventory turnover
ratio is below 5 in all the years except 2018. This means Abbott doesn’t have enough
inventory on hand.
Now lastly would talk about the solvency ratios. The total debt-to-assets ratio is
also increasing from 2016 to 2019. This means Abbott is using more debts to finance
its assets which is bad for the company.
So, this was the analysis of some of the most important ratios of the company. And
as discussed Abbott’s performance in 2021 is not too bad especially post covid. This
might be affected more due to CoronaVirus in 2020 and now Abbott should make
strategies to overcome where they are lacking.

INDUSTRY COMPARISON
Current Ratio 2.3
Quick Ratio 1.5
Accounts Receivable
Turnover 13
Inventory turnover 4.3
Fixed asset turnover 3.5
Total asset turnover 1.2
Debt ratio 29.1
Operating profit margin 11.1
Net profit margin 14.6
Gross Profit Margin 0.5
Return on total equity 25.5
Price to book value 2.1

INTERPRETATION
The current ratio of Abbott in 2021 is 1.97 and the quick ratio is 1.16 which is
comparatively low than the other industry leader. AR turnover of the co-leader is 13
whereas Abbott’s is 24. The debt ratio of Abbott is 0.3 where of leader co is 29
which means they had taken a lot of debt during 202 1.Abbott was comparatively
doing well in terms of recovery, there was a huge difference in GSK’s debt and
Abbots. The gross profit margin of leader is more than Abbott with a difference of
0.07 and 0.5.
 Detailed Analysis Of Both
Companies
Pharma companies, despite their reputation for being high-risk, can be attractive to
long-term investors. When it comes to investing in a publicly traded
pharmaceutical company, investors should pay close attention to these companies
once they enter the clinical trial stage. Clinical trials are frequently a make-or-
break opportunity for businesses and their products; positive results can lead to
significant market gains, while failures or lack of progress can have the opposite
result.
When we talk about Abbott pharmaceutical and Ferozsons Laboratories, we're
talking about sharks that have been around for a long time. Their work is self-
evident. However, as their success is compared, things get serious, and actual
figures make a difference, giving investors more confidence to invest in the
business.
Using the analysis above, it is clear that Abbott pharmaceutical has outperformed
Ferozsons Laboratories by a significant margin and continues to do so. Ferozsons
has managed to outperform Abbott pharmaceutical in some areas and gain an
advantage, but this has only happened on a rare basis, which is why Abbott
pharmaceutical is the best investment option among the two firms we have chosen
for our project. Abbott pharmaceutical has grown in size and profitability, and most
critically, it continues to please its investors with its financial results.
The Abbott pharmaceutical future plans are impressive, and its success can be
predicted in the coming years, ensuring that the company continues to thrive and
keep its investors happy. For several years, Abbott financial performance has been
excellent, and the Company's performance for the fiscal year ending June 30, 2020
has continued on this positive track. The company has created tremendous value
for its shareholders by consistently achieving double-digit growth and profitability.
Basic measures taken by Abbott pharmaceutical limited has been commendable
and quite effective as they have also reaped results by improving their financial
position. Yet for more stable conditions and for the future they could work to invest
in research and development for alternatives if raw materials are in shortage. Also
they could work with the Pakistan Pharmaceutical Manufacturers association to
have reserves of raw materials in case of future crisis, or work out some other
measures to cut down the negative effect of currency rates and economic
conditions on the pharmaceutical industry.
 RECOMMENDATION
The pharmaceutical industry in Pakistan has grown during the past decades. At the
time of the independence of Pakistan in 1947, there were few production units in the
country. Currently, Pakistan has more than 800 large-volume pharmaceutical
formulation units, including those operated by 25 multinationals present in the country.
Almost all the raw materials used in making medicine are sourced from abroad. About
50 percent of them are imported from India. Moreover, the government should
strategically extend more support for the pharmaceutical sector enabling it to play a
more authoritative role in helping people to provide free medicines, constant
production of medicines, etc. Pharmaceutical companies are allowed to deal in generic
and/or brand medications and medical devices. They are subject to a variety of laws
and regulations of the government regarding the patenting, testing, pricing and
ensuring safety and efficacy, and marketing of drugs. They should reduce the
regulation between the supplier and the company so we reduce the COGS. Hence
Abbott should increase its production and marketing strategies as it has really strong
competitors like Reckkit, GSK having the competitors for Brufen against panadol and
even Cal C against CAL 1000.It should continue to invest in plants and come up with
formulas of medicines against its competitors. Equity has increased hence they should
continue investment in R&D to continue to grow. The Pharmaceutical Industry (the
Pharma industry is an integral part of the healthcare system in every country.

WHAT DID YOU LEARN FROM THIS

PROJECT?
This project was very different from the ones we had done previously. When we first
read the project description, it appeared to be a difficult task, but once we divided the
work among our group members and began working on it individually, it became much
easier. This project taught us a lot, from basic concepts to difficult concepts. The first
step was extracting information from our respective firm’s financial reports, which
was difficult and time-consuming, but once we had it organized on the excel sheet,
taking out ratios became slightly easier and more convenient. The calculations were
challenging but enjoyable to complete because we were required to apply key financial
accounting concepts learned in class.
Analysis of financial reports using MS Word and MS Excel is another thing we learned
from this project that we would not have learned otherwise. This also resulted in a
good understanding of accounting procedures and the various options available to us
when preparing a cooperative financial statement. This project also taught us how to
read and understand financial statements, which will be helpful in our professional
lives. We had no idea about the usefulness and limitations of accounting data prior to
working on this project, but we now have a basic understanding of them. We had no
idea how the Pakistan stock exchange's website worked before this project, but now
we know how to use it, find all of the listed companies, find firms through sectors,
interpret share values, and finally, find out the details of the companies with the
representative's information.