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India is our top investment mkt, fundamentally vital: Abbot

For the USD 40 billion US drug maker Abbott Laboratories, India is a priority investment market — in its first television interaction in India and an exclusive conversation with CNBC-TV18’s Archana Shukla, Abbott management says focus is dual; invest to build Indian facilities as global manufacturing sources and focus on Indian nutrition space with its new facility. Bhaskar Iyer, India Representative, Abbott and Amal Kelshikar, Country Manager, Abbott Nutrition also spoke about the company’s expansion plans.

Also Read: See growth in EMs; to manufacture in India, China, says Abbott

Below is the verbatim transcript of Bhaskar Iyer’s and Amal Kelshikar’s interview with CNBC-TV18’s Archana Shukla.

Iyer: (starts in middle..) India is an investment priority. India is fundamentally important to the future. That very strongly demonstrates where India stands among emerging markets. This year we would have a turnover upward of USD 900 million and all of us take pride in the fact that we are in the top five countries globally in terms of sales contribution to our global sales.

In India we possibly have the largest operation. We have 14,000 employees which is approximately 20 percent of the global workforce. So this clearly shows that India is a priority country for Abbott. Currently we are investing in upgrading our manufacturing facility in Baddi to really be catering to global markets. We are in the midst of a strategic assessment of how do we scale up our R&D centre to really not only be catering to the Indian market but possibly cater to the global markets and how do we create linkages with other centres of excellence, may it be in Russia or Brazil.

Q: You are expanding right now, you said in terms of capacities?

Iyer: That is right. In recent times we hear the Prime Minister referring to a ‘Make in India’ theme. This is a philosophy which has resonated with Abbott for a long time. While in Baddi we are now actually moving from make in India for India to make in India even for global markets. So in the coming months we would also be catering to a few important emerging markets on the global front.

Q: You have said you would be growing somewhere around 20-22 percent with Piramal and the entire integration but in the last two to three years time we have seen you growing around 9 to12 percent of growth. Where is it which is bringing in this gap?

Iyer: We are broadly okay from a strategic sense as to what it has delivered. We have delivered ahead of what the market is growing at as I mentioned even this year and clearly if anything we will further accelerate our growth from here.

Q: The other focus area for the company, and you have been one of the oldest in that space, also is nutrition. Particularly talking about the Greenfield project that you have set up here; which are the markets that it would be servicing. Would it only focus on India or like your pharmaceutical division you would also look at expanding the scope of this plant to cater to other global markets?

Kelshikar: Our main aim in India for the nutrition business is to get closer to a customer. Our first aim is we are making in India and making for India with the world class standards. Does it have a potential to export, it has because it is a state of the art plant.

Q: You are currently the number one player with a large 7 percent or so market share, but we have seen a lot of changes on ground especially the biggest one was Sun Pharma’s acquisition of Ranbaxy which has toppled the chart again. How do you see changes in strategies and policies that as a company you would want to take to steer ahead in this competitive market?

Iyer: In our case we would extremely, strongly focus on growing our existing portfolio organically. Having said that we would also as an organisation be open to grow through inorganic means but if one, it needs to have a very compelling strategic rationale to do so.

Q: So you are open to acquisitions even beyond this?

Iyer: I would say so and also it needs to make sound financial sense.

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