Ranbaxy net dips by 8% - Views on News from Equitymaster

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Ranbaxy net dips by 8%

Jan 15, 2001

Ranbaxy has reported a net profit of Rs 1,809 m on a turnover of Rs 17,418 m for the full year ended December 2000. While turnover has grown 12% the net profit has actually declined by 8%. However, for the fourth quarter ended 30th December 2000, net profit has gone up by 50% to Rs 483 m. Sales for the fourth quarter has increased from Rs 4,168 m to Rs 4,785 m.

(Rs m) FY00 FY01 Change
Sales 15,598 17,418 11.7%
Other Income 715 471 -34.1%
Profit after Tax/(Loss) 1,969 1,809 -8.1%
Net profit margin (%) 12.6% 10.4%  
No. of Shares (eoy) (m) 115.9 115.9  
Earnings per share 17.0 15.6  
P/E   41.4  

The disappointment for Ranbaxy, however, was the non-receipt of the milestone payment from Bayer, which the company has said will accrue in the first quarter of the current year. Besides, the company’s export of the generic cefuroxime axcetil has also run aground due to the litigation filed by Glaxo in the US courts. The coming year’s performance would be dependent on how soon the company’s US subsidiary breaks even.

The stock quotes at a price of Rs 646 which implies an earnings multiple of 41 times. The year 2000 saw the stock come off almost 50%. Whether 2001 would be any better remains to be seen.

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