AARTI PHARMALABS 2023-24 Annual Report Analysis

Wed, 17 Jul

AARTI PHARMALABS has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the company during FY23-24.

AARTI PHARMALABS Income Statement Analysis

• Operating income during the year fell 4.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 12.9% YoY during the fiscal. Operating profit margins witnessed a fall and down at 20.8% in FY24 as against 17.6% in FY23.
• Depreciation charges increased by 17.1% and finance costs decreased by 18.2% YoY, respectively.
• Other income grew by 111.2% YoY.
• Net profit for the year grew by 12.1% YoY.
• Net profit margins during the year grew from 9.9% in FY23 to 11.7% in FY24.

AARTI PHARMALABS Income Statement 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Net Sales	Rs m	19,452	18,526	-4.8%
Other income	Rs m	23	49	111.2%
Total Revenues	Rs m	19,476	18,575	-4.6%
Gross profit	Rs m	3,421	3,860	12.9%
Depreciation	Rs m	625	732	17.1%
Interest	Rs m	211	172	-18.2%
Profit before tax	Rs m	2,608	3,005	15.2%
Tax	Rs m	673	836	24.2%
Profit after tax	Rs m	1,935	2,169	12.1%
Gross profit margin	%	17.6	20.8
Effective tax rate	%	25.8	27.8
Net profit margin	%	9.9	11.7

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AARTI PHARMALABS Balance Sheet Analysis

• The company's current liabilities during FY24 stood at Rs 7 billion as compared to Rs 6 billion in FY23, thereby witnessing an increase of 15.6%.
• Long-term debt down at Rs 0 million as compared to Rs 2 million during FY23, a fall of 78.8%.
• Current assets rose 16% and stood at Rs 13 billion, while fixed assets rose 14% and stood at Rs 12 billion in FY24.
• Overall, the total assets and liabilities for FY24 stood at Rs 26 billion as against Rs 22 billion during FY23, thereby witnessing a growth of 15%.

AARTI PHARMALABS Balance Sheet as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	15,585	17,568	12.7
Current Liabilities	Rs m	6,006	6,944	15.6
Long-term Debt	Rs m	2	0	-78.8
Total Liabilities	Rs m	22,440	25,821	15.1
Current assets	Rs m	11,630	13,456	15.7
Fixed Assets	Rs m	10,810	12,365	14.4
Total Assets	Rs m	22,440	25,821	15.1

AARTI PHARMALABS Cash Flow Statement Analysis

• AARTI PHARMALABS's cash flow from operating activities (CFO) during FY24 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY24 stood at Rs -2 billion, an improvement of 36.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY24 stood at Rs 97 million, an improvement of 106% on a YoY basis.
• Overall, net cash flows for the company during FY24 stood at Rs 115 million from the Rs -712 million net cash flows seen during FY23.

AARTI PHARMALABS Cash Flow Statement 2023-24

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-23	Mar-24
Cash Flow from Operating Activities	Rs m	2,501	2,164	-13.5%
Cash Flow from Investing Activities	Rs m	-1,578	-2,146	-
Cash Flow from Financing Activities	Rs m	-1,635	97	-
Net Cash Flow	Rs m	-712	115	-

Current Valuations for AARTI PHARMALABS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 23.9, an improvement from the EPS of Rs 21.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 608.0, stands at 25.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.1 times, while the price to sales ratio stands at 3.0 times.
• The company's price to cash flow (P/CF) ratio stood at 13.5 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Sales per share (Unadj.)	Rs	214.6	204.4
TTM Earnings per share	Rs	21.3	23.9
Diluted earnings per share	Rs	21.4	23.9
Price to Cash Flow	x	9.7	13.5
TTM P/E ratio	x	12.9	25.4
Price / Book Value ratio	x	1.9	2.2
Market Cap	Rs m	30,178	39,277
Dividends per share (Unadj.)	Rs	2.0	3.0

Ratio Analysis for AARTI PHARMALABS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.9x during FY24, from 1.9x during FY23. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio improved and stood at 18.5x during FY24, from 13.4x during FY23. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company declined and down at 12.3% during FY24, from 12.4% during FY24. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 18.1% during FY24, from 18.1% during FY23. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company declined and down at 9.1% during FY24, from 9.6% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Current ratio	x	1.9	1.9
Debtors’ Days	Days	845	1,023
Interest coverage	x	13.4	18.5
Debt to equity ratio	x	0.0	0.0
Return on assets	%	9.6	9.1
Return on equity	%	12.4	12.3
Return on capital employed	%	18.1	18.1

To see how AARTI PHARMALABS has performed over the last 5 years, please visit here.

AARTI PHARMALABS Share Price Performance

Over the last one year, AARTI PHARMALABS share price has moved up from Rs 328.3 to Rs 608.0, registering a gain of Rs 279.7 or around 85.2%.

Overall, the S&P BSE SENSEX is up 21.2% over the year.

(To know more, check out historical annual results for AARTI PHARMALABS and quarterly results for AARTI PHARMALABS)