API Holdings Limited

(PharmEasy)
Pharma Tech- Research Report Oct 2021

Updated on Oct 30, 2021 1

Investment Rationale
● Indian E-pharmacy industry is relatively young and holds a huge potential for growth.
● Innovative and easy-to-use e-pharmacy platforms and the rapid digitization has begun to revolutionize the pharmacy industry.
● PharmEasy, being one the leading players in the market, holds around 60-70% market share with revenues of over INR 637 Cr in FY20.
● Many major marquee investors have picked up stakes in the Company ahead of the IPO.
● As the industry grows, PharmEasy with its sound business model and market domination, is expected to generate wealth to its
stakeholders.
● The Company competes with Tata’s 1MG, Apollo pharmacy and Reliance’s Netmeds in the segment.

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Company Synopsis
| Segment
PharmEasy is a developing a healthcare delivery platform. It helps patients to connect with local pharmacy stores and diagnostic centers
enabling them to order medicines, healthcare products, and diagnostic tests. The company aims to improve the supply chain in the
pharmaceutical sector by digitizing the process. PharmEasy is operated by and under API Holdings Limited.

| Foundation
PharmEasy was founded by Mr. Dharmil Sheth and Dr. Dhaval Shah in 2014. The company was later brought under the ambit of API Holdings
Limited in 2019.

| Business Model
● PharmEasy delivers medicines and other medical accessories across Indian towns and cities. The pin codes maintained by PharmEasy
are used to identify pharmacies closest to the customers. Customers can either access PharmEasy's website or use its mobile app to
order items.

● Customers are entitled to discounts of up to 20% if they order using the mobile app, which further increases the brand recognition and
adds in new customers to PharmEasy.

● PharmEasy is an e-pharmacy, the processes of which are mostly online acting as a 3-way chain between the buyers, suppliers, and the
distribution network.

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API Holdings Limited Eco-system

API Holdings Limited

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PharmEasy-as Easy as it gets

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Pharmeasy - Medlife

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Pharmeasy - Thyrocare

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Pharmeasy - Aknamed

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Key aspects of Business Model

Buyers Pharmacists Distribution

•PharmEasy is a • PharmEasy • PharmEasy

ready platform collaborates with a operates with a
from which the wide range of local vast distribution
buyers can suppliers and spread out all
search for their medical shops, all across the nation.
medicines or of which help the This helps the
healthcare company to company to deliver
accessories and arrange their their products for a
stocks. broad range of pin
buy them online
without any • The company also codes all over
earns revenue India.
hassles.
from various
•The platform also pharmaceutical
offers various companies that
digital payment want to showcase
options. their products
online and on the
PharmEasy app as
featured brands.

Due to various rules and regulations set by the Indian government, the company does not deliver Schedule H drugs.

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Revenue Model
• PharmEasy primarily earns by displaying the sponsored results of various pharmaceutical entities. These kinds of
advertisements are found on the home page of such organizations.
• Advertising is a major source of revenue and this e-pharmacy leverages it to the hilt. Attractive discounts also contribute
to PharmEasy's revenue. It offers considerable discounts to the customers which makes it preferable than traditional
pharmacy.
• PharmEasy offers additional discounts for payments made through its partner gateways and/or bank channels.
• Furthermore, PharmEasy earns from commission from its customers for the healthcare products and medicines that sell
via the platform.
• The brand also earns through the delivery charges that get levied on the products.

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PharmEasy Entrepreneur Network
• PharmEasy, through its Entrepreneur Network, offers an opportunity to individuals to become a PharmEasy Franchise
Partner with minimum investment of as low as INR 20,000/-.
• PharmEasy has 800+ Franchise network all over the country
• This allows for bilateral growth as it expands the PharmEasy network and the franchise partners can earn upto INR
1,00,000/- per month.
• Sales above INR 1 lakh per month benefits the Women franchise partners to get 1% extra commission on platform only
orders.

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Business measures
Revenue
PharmEasy has nearly doubled its revenue in FY20 to
Rs 637 crore ($87.75 Million).

5 Million+ 22,000+ 1200+

Indian Families Serves Deliverable Pin-codes Cities under the cover

80,000+ 10 Million+
Pharmacy partners across the App downloads so far
Country

Source: www.pharmeasy.com
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PharmEasy Core Values

Source: www.pharmeasy.com
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Shareholding Pattern

Source: https://entrackr.com/2021/10/unpacking-pharmeasys-pre-ipo-round-and-current-shareholding/ 14
Recent acquisitions by API Holdings Ltd
• API Holding Limited, acquired Medlife – a strong player in E-pharmacy sector in May 2021 and the resultant entity became
the leading e-pharmacy in the country.
• Medlife is a healthcare company is primarily engaged in wholesale and distribution of drugs.
• Medlife was valued at $375 million as of January 31, 2021.

PharmEasy + Medlife

Serving over +2 million

Over 60% Market Share
customers

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Recent acquisitions by API Holdings Ltd
• API Holding Limited, signed agreement to acquire a 66.1% stake in Thyrocare for INR 4,546 Cr in June 2021. This was a First-
ever acquisition of a listed company by an Indian unicorn.
• Thyrocare Technologies Limited is a multinational chain of diagnostic and preventive care laboratories.
• Thyrocare has total 1,122 outlets (as of 2021) and collection centers across India and parts of Nepal, Bangladesh and the
Middle East
• The combined entity to have ability to provide diagnostic and pharmacy services to 100 million in 24 hours.

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Recent acquisitions by API Holdings Ltd
• API Holding Limited, acquired Aknamed – India’s largest cloud based platform for hospital supply chin management, for
about $180-$190 in September 2021.
• Bengaluru-based Akanamed offers procurement solutions to over 1,200 hospitals, including Manipal Hospitals, Columbia
Asia, and Narayana Health.
• Aknamed’s monthly revenue run-rate grew 10 times by the end of the FY21.
• The acquisition, which is similar to its purchase of Thyrocare in June, is part of API Holding’s plans to position itself as a
broader online healthcare firm, diversifying from being just an online medicine delivery platform.

Source: https://economictimes.indiatimes.com/tech/startups/pharmeasy-acquires-aknamed-in-180-190-million-stock-deal/articleshow/86201854.cms 17
FINTACKR
Recent funding in API Holdings
Date Funding Amt Investor Details
Oct 2021 $339M Neuberger Berman, OrbiMed Advisors, Steadview Capital and others
Jun 28, 2021 $300M Kotak Mahindra Bank, Temasek and 4 others
Jun 02, 2021 $44.5M B Capital Group, JM Financial and 6 others
Apr 05, 2021 $163M Naspers, Hardik Dedhia and 8 others
Feb 24, 2021 $66.4M Temasek, Caisse de depot et placement du Quebec and 3 others
Nov 26, 2019 $220M Temasek, Bessemer Venture Partners and 11 others

Source: https://www.pymnts.com/news/ipo/2021/india-pharmeasy-takes-in-339m-before-going-public/ 18
Updates on API Holdings

Source: https://www.moneycontrol.com 19
Updates on API Holdings

Source: https://www.livemint.com/market/ipo/pharmeasy-targets-9-bn-ipo-valuation-11629139531607.html 20
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