CADILA HEALTHCARE 2017-18 Annual Report Analysis

Sat, 31 Mar

CADILA HEALTHCARE has announced its results for the year ended March 2018. Let us have a look at the detailed performance review of the company during FY17-18.

CADILA HEALTHCARE Income Statement Analysis

• Operating income during the year rose 29.7% on a year-on-year (YoY) basis.
• The company's operating profit increased by 48.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.8% in FY18 as against 20.7% in FY17.
• Depreciation charges increased by 44.3% and finance costs increased by 75.6% YoY, respectively.
• Other income declined by 9.6% YoY.
• Net profit for the year grew by 17.8% YoY.
• Net profit margins during the year declined from 16.2% in FY17 to 14.7% in FY18.

CADILA HEALTHCARE Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	91,807	119,050	29.7%
Other income	Rs m	1,471	1,330	-9.6%
Total Revenues	Rs m	93,278	120,380	29.1%
Gross profit	Rs m	19,012	28,286	48.8%
Depreciation	Rs m	3,733	5,388	44.3%
Interest	Rs m	631	1,108	75.6%
Profit before tax	Rs m	16,119	23,120	43.4%
Tax	Rs m	1,289	5,644	337.9%
Profit after tax	Rs m	14,830	17,476	17.8%
Gross profit margin	%	20.7	23.8
Effective tax rate	%	8.0	24.4
Net profit margin	%	16.2	14.7

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CADILA HEALTHCARE Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 61 billion as compared to Rs 53 billion in FY17, thereby witnessing an increase of 14.6%.
• Long-term debt stood at Rs 26 billion as compared to Rs 25 billion during FY17, a growth of 3.5%.
• Current assets rose 37% and stood at Rs 82 billion, while fixed assets rose 7% and stood at Rs 89 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 171 billion as against Rs 143 billion during FY17, thereby witnessing a growth of 20%.

CADILA HEALTHCARE Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	69,600	87,445	25.6
Current Liabilities	Rs m	53,058	60,830	14.6
Long-term Debt	Rs m	24,684	25,551	3.5
Total Liabilities	Rs m	143,252	171,407	19.7
Current assets	Rs m	60,223	82,297	36.7
Fixed Assets	Rs m	83,029	89,110	7.3
Total Assets	Rs m	143,252	171,407	19.7

CADILA HEALTHCARE Cash Flow Statement Analysis

• CADILA HEALTHCARE's cash flow from operating activities (CFO) during FY18 stood at Rs 9 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -10 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs 515 million on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -29 million from the Rs 8 billion net cash flows seen during FY17.

CADILA HEALTHCARE Cash Flow Statement 2017-18

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-17	Mar-18
Cash Flow from Operating Activities	Rs m	13,117	9,193	-29.9%
Cash Flow from Investing Activities	Rs m	-28,719	-9,737	-
Cash Flow from Financing Activities	Rs m	23,158	515	-97.8%
Net Cash Flow	Rs m	7,556	-29	-

Current Valuations for CADILA HEALTHCARE

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 17.1, an improvement from the EPS of Rs 14.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 378.7, stands at 22.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.4 times, while the price to sales ratio stands at 4.0 times.
• The company's price to cash flow (P/CF) ratio stood at 20.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Sales per share (Unadj.)	Rs	89.7	116.3
TTM Earnings per share	Rs	14.5	17.1
Diluted earnings per share	Rs	14.5	17.1
Price to Cash Flow	x	24.4	20.6
TTM P/E ratio	x	32.9	22.2
Price / Book Value ratio	x	5.6	5.4
Market Cap	Rs m	391,582	470,666
Dividends per share (Unadj.)	Rs	3.2	3.5

Ratio Analysis for CADILA HEALTHCARE

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.4x during FY18, from 1.1x during FY17. 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 21.9x during FY18, from 26.5x during FY17. 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 20.0% during FY18, from 21.3% during FY18. 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 21.4% during FY18, from 17.8% during FY17. 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 10.8% during FY18, from 10.8% during FY17. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*
Current ratio	x	1.1	1.4
Debtors’ Days	Days	91	98
Interest coverage	x	26.5	21.9
Debt to equity ratio	x	0.4	0.3
Return on assets	%	10.8	10.8
Return on equity	%	21.3	20.0
Return on capital employed	%	17.8	21.4

To see how CADILA HEALTHCARE has performed over the last 5 years, please visit here.

CADILA HEALTHCARE Share Price Performance

Over the last one year, CADILA HEALTHCARE share price has moved down from Rs 443.3 to Rs 378.7, registering a loss of Rs 64.6 or around 14.6%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 13,157.6 (down 1.1%). Over the last one year it has moved down from 15,312.4 to 13,157.6, a loss of 2,155 points (down 14.1%).

Overall, the S&P BSE SENSEX is up 12.1% over the year.

(To know more, check out historical annual results for CADILA HEALTHCARE and quarterly results for CADILA HEALTHCARE)

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