A local giant in the pharma industry, Highnoon Laboratories Limited (PSX:HINOON) was incorporated in 1984 as a private limited company in Lahore. It went public in 1985 , and since then it has risen to a position of prominence in the domestic pharma scene. Today, the company's market capitalisation stands north of Rs 10 billion - more than twice what it was a year ago.

Highnoon has been allied with the best-known research houses of the global pharmaceutical industry. It became the first pharmaceutical company of Pakistani origin to be in the top twenty league of Pakistan's pharmaceutical industry.

The company leads in terms of therapeutics, and boasts a wide portfolio of cardiovascular, respiratory, alimentary tract and metabolism, and diabetes products. Among others, its star products include Kestine, Tres Orix Forte, Combivair, and Uslanic.

Prior Performance

Despite a strict regulatory environment that has restricted price increases on most pharmaceutical products since 2001, Highnoon Laboratories has been on an unabated growth course. Save for a dip in sales in CY12 (due to revenues from Solvey Pharmaceuticals products not being recognised on full sales value after the acquisition by Abbott), the company has been going in only one direction - up. Profits and margins have seen plentiful growth over the six-year period, with gross profit more than doubling and the bottom line figure skyrocketing by over 530 percent.

Highnoon's exceptional performance in the market is all the more commendable given the fact that it does not have a consumer healthcare segment. Since the price-frozen drugs haven't been giving pharma companies enough growth, most companies like GSK, Abbott, and Searle have adopted the strategy of emphasising on consumer healthcare segment (oral health, nutrition, dietary supplements, etc) in order to boost margins. Highnoon, however, has not adopted this strategy.