AJANTA PHARMA 2022-23 Annual Report Analysis

Mon, 19 Jun

AJANTA PHARMA has announced its results for the year ended March 2023. Let us have a look at the detailed performance review of the company during FY22-23.

AJANTA PHARMA Income Statement Analysis

• Operating income during the year rose 12.0% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 15.7% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 20.9% in FY23 as against 27.8% in FY22.
• Depreciation charges increased by 4.4% and finance costs decreased by 42.7% YoY, respectively.
• Other income declined by 14.7% YoY.
• Net profit for the year declined by 17.5% YoY.
• Net profit margins during the year declined from 21.3% in FY22 to 15.7% in FY23.

AJANTA PHARMA Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	33,410	37,426	12.0%
Other income	Rs m	1,157	986	-14.7%
Total Revenues	Rs m	34,567	38,413	11.1%
Gross profit	Rs m	9,293	7,833	-15.7%
Depreciation	Rs m	1,253	1,308	4.4%
Interest	Rs m	102	58	-42.7%
Profit before tax	Rs m	9,095	7,453	-18.1%
Tax	Rs m	1,968	1,573	-20.1%
Profit after tax	Rs m	7,127	5,880	-17.5%
Gross profit margin	%	27.8	20.9
Effective tax rate	%	21.6	21.1
Net profit margin	%	21.3	15.7

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AJANTA PHARMA Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 11 billion as compared to Rs 6 billion in FY22, thereby witnessing an increase of 76.0%.
• Long-term debt down at Rs 13 million as compared to Rs 16 million during FY22, a fall of 23.8%.
• Current assets rose 25% and stood at Rs 28 billion, while fixed assets fell 3% and stood at Rs 19 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 47 billion as against Rs 42 billion during FY22, thereby witnessing a growth of 12%.

AJANTA PHARMA Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	32,640	33,877	3.8
Current Liabilities	Rs m	6,474	11,393	76.0
Long-term Debt	Rs m	16	13	-23.8
Total Liabilities	Rs m	41,968	47,047	12.1
Current assets	Rs m	22,645	28,252	24.8
Fixed Assets	Rs m	19,323	18,707	-3.2
Total Assets	Rs m	41,968	47,047	12.1

AJANTA PHARMA Cash Flow Statement Analysis

• AJANTA PHARMA's cash flow from operating activities (CFO) during FY23 stood at Rs 8 billion, an improvement of 41.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -6 billion, an improvement of 655.2% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -1 billion, an improvement of 77% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 1 billion from the Rs 279 million net cash flows seen during FY22.

AJANTA PHARMA Cash Flow Statement 2022-23

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-22	Mar-23
Cash Flow from Operating Activities	Rs m	5,617	7,918	41.0%
Cash Flow from Investing Activities	Rs m	-741	-5,596	-
Cash Flow from Financing Activities	Rs m	-4,597	-1,079	-
Net Cash Flow	Rs m	279	1,243	345.6%

Current Valuations for AJANTA PHARMA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 46.7, an decline from the EPS of Rs 83.4 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,470.5, stands at 31.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 5.5 times, while the price to sales ratio stands at 4.9 times.
• The company's price to cash flow (P/CF) ratio stood at 21.8 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Sales per share (Unadj.)	Rs	391.1	297.2
TTM Earnings per share	Rs	83.4	46.7
Diluted earnings per share	Rs	56.6	46.7
Price to Cash Flow	x	18.1	21.8
TTM P/E ratio	x	21.3	31.5
Price / Book Value ratio	x	3.5	4.6
Market Cap	Rs m	115,433	156,638
Dividends per share (Unadj.)	Rs	9.5	7.0

Ratio Analysis for AJANTA PHARMA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 2.5x during FY23, from 3.5x during FY22. 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 128.6x during FY23, from 90.2x during FY22. 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 17.4% during FY23, from 21.8% during FY23. 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 declined and down at 22.2% during FY23, from 28.2% during FY22. 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 12.6% during FY23, from 17.2% during FY22. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*
Current ratio	x	3.5	2.5
Debtors’ Days	Days	11	10
Interest coverage	x	90.2	128.6
Debt to equity ratio	x	0.0	0.0
Return on assets	%	17.2	12.6
Return on equity	%	21.8	17.4
Return on capital employed	%	28.2	22.2

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

AJANTA PHARMA Share Price Performance

Over the last one year, AJANTA PHARMA share price has moved up from Rs 1,202.7 to Rs 1,470.5, registering a gain of Rs 267.8 or around 22.3%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 25,067.1 (up 0.7%). Over the last one year it has moved up from 21,006.2 to 25,067.1, a gain of 4,061 points (up 19.3%).

Overall, the S&P BSE SENSEX is up 20.6% over the year.

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