ALEMBIC PHARMA 2018-19 Annual Report Analysis

Sun, 31 Mar

ALEMBIC PHARMA has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

ALEMBIC PHARMA Income Statement Analysis

• Operating income during the year rose 25.7% on a year-on-year (YoY) basis.
• The company's operating profit increased by 39.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.8% in FY19 as against 19.7% in FY18.
• Depreciation charges increased by 9.3% and finance costs increased by 441.5% YoY, respectively.
• Other income declined by 22.2% YoY.
• Net profit for the year grew by 40.8% YoY.
• Net profit margins during the year grew from 13.4% in FY18 to 15.1% in FY19.

ALEMBIC PHARMA Income Statement 2018-19

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Net Sales	Rs m	31,308	39,347	25.7%
Other income	Rs m	349	271	-22.2%
Total Revenues	Rs m	31,657	39,618	25.1%
Gross profit	Rs m	6,153	8,558	39.1%
Depreciation	Rs m	1,055	1,152	9.3%
Interest	Rs m	34	184	441.5%
Profit before tax	Rs m	5,413	7,493	38.4%
Tax	Rs m	1,204	1,568	30.2%
Profit after tax	Rs m	4,209	5,926	40.8%
Gross profit margin	%	19.7	21.8
Effective tax rate	%	22.2	20.9
Net profit margin	%	13.4	15.1

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ALEMBIC PHARMA Balance Sheet Analysis

• The company's current liabilities during FY19 stood at Rs 17 billion as compared to Rs 13 billion in FY18, thereby witnessing an increase of 31.3%.
• Long-term debt down at Rs 5 billion as compared to Rs 5 billion during FY18, a fall of 0.1%.
• Current assets rose 9% and stood at Rs 21 billion, while fixed assets rose 33% and stood at Rs 28 billion in FY19.
• Overall, the total assets and liabilities for FY19 stood at Rs 50 billion as against Rs 41 billion during FY18, thereby witnessing a growth of 22%.

ALEMBIC PHARMA Balance Sheet as on March 2019

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*	% Change
Networth	Rs m	22,201	27,188	22.5
Current Liabilities	Rs m	12,672	16,637	31.3
Long-term Debt	Rs m	5,000	4,993	-0.1
Total Liabilities	Rs m	40,638	49,518	21.8
Current assets	Rs m	19,475	21,317	9.5
Fixed Assets	Rs m	21,163	28,200	33.3
Total Assets	Rs m	40,638	49,518	21.8

ALEMBIC PHARMA Cash Flow Statement Analysis

• ALEMBIC PHARMA's cash flow from operating activities (CFO) during FY19 stood at Rs 8 billion, an improvement of 159.9% on a YoY basis.
• Cash flow from investing activities (CFI) during FY19 stood at Rs -8 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY19 stood at Rs 590 million on a YoY basis.
• Overall, net cash flows for the company during FY19 stood at Rs 1 billion from the Rs -693 million net cash flows seen during FY18.

ALEMBIC PHARMA Cash Flow Statement 2018-19

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-18	Mar-19
Cash Flow from Operating Activities	Rs m	3,124	8,120	159.9%
Cash Flow from Investing Activities	Rs m	-8,844	-7,556	-
Cash Flow from Financing Activities	Rs m	5,026	590	-88.3%
Net Cash Flow	Rs m	-693	1,153	-

Current Valuations for ALEMBIC PHARMA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 31.4, an improvement from the EPS of Rs 22.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 530.6, stands at 17.6 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.8 times, while the price to sales ratio stands at 2.5 times.
• The company's price to cash flow (P/CF) ratio stood at 14.3 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Sales per share (Unadj.)	Rs	166.1	208.7
TTM Earnings per share	Rs	22.3	31.4
Diluted earnings per share	Rs	21.4	30.1
Price to Cash Flow	x	20.5	14.3
TTM P/E ratio	x	25.7	17.6
Price / Book Value ratio	x	4.7	3.7
Market Cap	Rs m	105,079	101,459
Dividends per share (Unadj.)	Rs	4.0	5.5

Ratio Analysis for ALEMBIC PHARMA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.3x during FY19, from 1.5x during FY18. 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 deteriorated and stood at 41.7x during FY19, from 160.2x during FY18. 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 improved and stood at 21.8% during FY19, from 19.0% during FY19. 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 23.9% during FY19, from 20.0% during FY18. 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 improved and stood at 12.3% during FY19, from 10.4% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-18*	12 Mar-19*
Current ratio	x	1.5	1.3
Debtors’ Days	Days	6	5
Interest coverage	x	160.2	41.7
Debt to equity ratio	x	0.2	0.2
Return on assets	%	10.4	12.3
Return on equity	%	19.0	21.8
Return on capital employed	%	20.0	23.9

To see how ALEMBIC PHARMA has performed over the last 5 years, please visit here.

ALEMBIC PHARMA Share Price Performance

Over the last one year, ALEMBIC PHARMA share price has moved down from Rs 549.8 to Rs 530.6, registering a loss of Rs 19.3 or around 3.5%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 14,407.9 (up 1.4%). Over the last one year it has moved up from 13,157.6 to 14,407.9, a gain of 1,250 points (up 9.5%).

Overall, the S&P BSE SENSEX is up 16.3% over the year.

(To know more, check out historical annual results for ALEMBIC PHARMA and quarterly results for ALEMBIC PHARMA)

Read: Latest Annual Report Analysis of ALEMBIC PHARMA