LAURUS LABS 2020-21 Annual Report Analysis

Wed, 31 Mar

LAURUS LABS has announced its results for the year ended March 2021. Let us have a look at the detailed performance review of the company during FY20-21.

LAURUS LABS Income Statement Analysis

• Operating income during the year rose 70.0% on a year-on-year (YoY) basis.
• The company's operating profit increased by 174.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 32.2% in FY21 as against 19.9% in FY20.
• Depreciation charges increased by 9.5% and finance costs decreased by 23.9% YoY, respectively.
• Other income grew by 299.7% YoY.
• Net profit for the year grew by 285.4% YoY.
• Net profit margins during the year grew from 9.0% in FY20 to 20.4% in FY21.

LAURUS LABS Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	28,317	48,135	70.0%
Other income	Rs m	59	237	299.7%
Total Revenues	Rs m	28,376	48,372	70.5%
Gross profit	Rs m	5,646	15,507	174.7%
Depreciation	Rs m	1,873	2,051	9.5%
Interest	Rs m	896	682	-23.9%
Profit before tax	Rs m	2,936	13,011	343.1%
Tax	Rs m	383	3,173	727.6%
Profit after tax	Rs m	2,553	9,838	285.4%
Gross profit margin	%	19.9	32.2
Effective tax rate	%	13.1	24.4
Net profit margin	%	9.0	20.4

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LAURUS LABS Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 25 billion as compared to Rs 17 billion in FY20, thereby witnessing an increase of 45.2%.
• Long-term debt stood at Rs 4 billion as compared to Rs 2 billion during FY20, a growth of 160.1%.
• Current assets rose 70% and stood at Rs 31 billion, while fixed assets rose 44% and stood at Rs 27 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 58 billion as against Rs 37 billion during FY20, thereby witnessing a growth of 56%.

LAURUS LABS Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	17,651	25,926	46.9
Current Liabilities	Rs m	16,924	24,572	45.2
Long-term Debt	Rs m	1,650	4,292	160.1
Total Liabilities	Rs m	36,764	57,507	56.4
Current assets	Rs m	18,121	30,749	69.7
Fixed Assets	Rs m	18,643	26,758	43.5
Total Assets	Rs m	36,764	57,507	56.4

LAURUS LABS Cash Flow Statement Analysis

• LAURUS LABS 's cash flow from operating activities (CFO) during FY21 stood at Rs 7 billion, an improvement of 111.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -9 billion, an improvement of 325.5% on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 3 billion, an improvement of 300% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 468 million from the Rs -13 million net cash flows seen during FY20.

LAURUS LABS Cash Flow Statement 2020-21

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-20	Mar-21
Cash Flow from Operating Activities	Rs m	3,474	7,330	111.0%
Cash Flow from Investing Activities	Rs m	-2,211	-9,410	-
Cash Flow from Financing Activities	Rs m	-1,277	2,547	-
Net Cash Flow	Rs m	-13	468	-

Current Valuations for LAURUS LABS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 18.3, an decline from the EPS of Rs 23.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 362.1, stands at 19.8 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 7.5 times, while the price to sales ratio stands at 4.0 times.
• The company's price to cash flow (P/CF) ratio stood at 40.6 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Sales per share (Unadj.)	Rs	264.9	89.7
TTM Earnings per share	Rs	23.9	18.3
Diluted earnings per share	Rs	4.8	18.3
Price to Cash Flow	x	39.2	40.6
TTM P/E ratio	x	67.9	19.8
Price / Book Value ratio	x	2.3	18.6
Market Cap	Rs m	40,521	483,157
Dividends per share (Unadj.)	Rs	0.5	2.0

Ratio Analysis for LAURUS LABS

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.3x during FY21, from 1.1x during FY20. 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 20.1x during FY21, from 4.3x during FY20. 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 37.9% during FY21, from 14.5% during FY21. 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 45.3% during FY21, from 19.9% during FY20. 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 18.3% during FY21, from 9.4% during FY20. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*
Current ratio	x	1.1	1.3
Debtors’ Days	Days	10	10
Interest coverage	x	4.3	20.1
Debt to equity ratio	x	0.1	0.2
Return on assets	%	9.4	18.3
Return on equity	%	14.5	37.9
Return on capital employed	%	19.9	45.3

To see how LAURUS LABS has performed over the last 5 years, please visit here.

LAURUS LABS Share Price Performance

Over the last one year, LAURUS LABS share price has moved up from Rs 322.6 to Rs 362.1, registering a gain of Rs 39.5 or around 12.2%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 21,328.2 (up 0.4%). Over the last one year it has moved up from 12,148.6 to 21,328.2, a gain of 9,180 points (up 75.6%).

Overall, the S&P BSE SENSEX is up 74.1% over the year.

(To know more, check out historical annual results for LAURUS LABS and quarterly results for LAURUS LABS )

Read: Latest Annual Report Analysis of LAURUS LABS