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ALKEM LABORATORIES 2020-21 Annual Report Analysis
Wed, 31 Mar

ALKEM LABORATORIES 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.

ALKEM LABORATORIES Income Statement Analysis

  • Operating income during the year rose 6.2% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 31.8% YoY during the fiscal. Operating profit margins witnessed a fall and down at 21.9% in FY21 as against 17.7% in FY20.
  • Depreciation charges increased by 8.6% and finance costs decreased by 9.4% YoY, respectively.
  • Other income grew by 123.8% YoY.
  • Net profit for the year grew by 40.8% YoY.
  • Net profit margins during the year grew from 13.8% in FY20 to 18.2% in FY21.

ALKEM LABORATORIES Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 83,444 88,650 6.2%
Other income Rs m 1,042 2,332 123.8%
Total Revenues Rs m 84,486 90,982 7.7%
Gross profit Rs m 14,734 19,424 31.8%
Depreciation Rs m 2,528 2,746 8.6%
Interest Rs m 651 589 -9.4%
Profit before tax Rs m 12,598 18,421 46.2%
Tax Rs m 1,105 2,243 103.1%
Profit after tax Rs m 11,493 16,178 40.8%
Gross profit margin % 17.7 21.9
Effective tax rate % 8.8 12.2
Net profit margin % 13.8 18.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Read Now: We're Bullish on 2 Non-Nifty Stocks

ALKEM LABORATORIES Balance Sheet Analysis

  • The company's current liabilities during FY21 stood at Rs 36 billion as compared to Rs 32 billion in FY20, thereby witnessing an increase of 11.1%.
  • Long-term debt down at Rs 343 million as compared to Rs 739 million during FY20, a fall of 53.7%.
  • Current assets rose 26% and stood at Rs 69 billion, while fixed assets fell 1% and stood at Rs 35 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 104 billion as against Rs 90 billion during FY20, thereby witnessing a growth of 16%.

ALKEM LABORATORIES Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 61,593 73,756 19.7
 
Current Liabilities Rs m 32,446 36,041 11.1
Long-term Debt Rs m 739 343 -53.7
Total Liabilities Rs m 90,130 104,114 15.5
 
Current assets Rs m 55,057 69,288 25.8
Fixed Assets Rs m 35,073 34,825 -0.7
Total Assets Rs m 90,130 104,114 15.5
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



ALKEM LABORATORIES Cash Flow Statement Analysis

  • ALKEM LABORATORIES's cash flow from operating activities (CFO) during FY21 stood at Rs 13 billion, an improvement of 116.2% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -10 billion, an improvement of 34.7% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY21 stood at Rs -3 billion on a YoY basis.
  • Overall, net cash flows for the company during FY21 stood at Rs -17 million from the Rs -731 million net cash flows seen during FY20.

ALKEM LABORATORIES 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 5,851 12,649 116.2%
Cash Flow from Investing Activities Rs m -7,414 -9,985 -
Cash Flow from Financing Activities Rs m 792 -2,718 -
Net Cash Flow Rs m -731 -17 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for ALKEM LABORATORIES

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 135.3, an improvement from the EPS of Rs 96.1 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 2,772.2, stands at 20.5 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 4.5 times, while the price to sales ratio stands at 3.7 times.
  • The company's price to cash flow (P/CF) ratio stood at 17.0 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 697.9 741.4
TTM Earnings per share Rs 96.1 135.3
Diluted earnings per share Rs 96.1 135.3
Price to Cash Flow x 19.9 17.0
TTM P/E ratio x 24.2 20.5
Price / Book Value ratio x 4.3 4.4
Market Cap Rs m 261,868 321,244
Dividends per share (Unadj.) Rs 25.0 30.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for ALKEM LABORATORIES

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.9x during FY21, from 1.7x 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 32.3x during FY21, from 20.4x 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 21.9% during FY21, from 18.7% 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 25.7% during FY21, from 21.3% 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 16.1% during FY21, from 13.5% 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 1.7 1.9
Debtors’ Days Days 72 66
Interest coverage x 20.4 32.3
Debt to equity ratio x 0.0 0.0
Return on assets % 13.5 16.1
Return on equity % 18.7 21.9
Return on capital employed % 21.3 25.7
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how ALKEM LABORATORIES has performed over the last 5 years, please visit here.

ALKEM LABORATORIES Share Price Performance

Over the last one year, ALKEM LABORATORIES share price has moved up from Rs 2,328.9 to Rs 2,772.2, registering a gain of Rs 443.4 or around 19.0%.

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 ALKEM LABORATORIES and quarterly results for ALKEM LABORATORIES)

Annual Report FAQs

What is the current share price of ALKEM LABORATORIES?

ALKEM LABORATORIES currently trades at Rs 4,940.2 per share. You can check out the latest share price performance of ALKEM LABORATORIES here...

What was the revenue of ALKEM LABORATORIES in FY21? How does it compare to earlier years?

The revenues of ALKEM LABORATORIES stood at Rs 90,982 m in FY21, which was up 7.7% compared to Rs 84,486 m reported in FY20.

ALKEM LABORATORIES' revenue has grown from Rs 56,346 m in FY17 to Rs 90,982 m in FY21.

Over the past 5 years, the revenue of ALKEM LABORATORIES has grown at a CAGR of 12.7%.

What was the net profit of ALKEM LABORATORIES in FY21? How does it compare to earlier years?

The net profit of ALKEM LABORATORIES stood at Rs 16,178 m in FY21, which was up 40.8% compared to Rs 11,493 m reported in FY20.

This compares to a net profit of Rs 7,736 m in FY19 and a net profit of Rs 6,384 m in FY18.

Over the past 5 years, ALKEM LABORATORIES net profit has grown at a CAGR of 15.6%.

What does the cash flow statement of ALKEM LABORATORIES reveal?

The cash flow statement is the financial statement that presents the cash inflows and outflows of a company during a given period of time.

This statement is one of the most useful tools for judging a company's liquidity position. The ratios and parameters in this statement helps test a company's financial health.

The cash flow statement of ALKEM LABORATORIES reveals:

  • Cash flow from operations increased in FY21 and stood at Rs 12,649 m as compared to Rs 5,851 m in FY20.
  • Cash flow from investments decreased in FY21 and stood at Rs -9,985 m as compared to Rs -7,414 m in FY20.
  • Cash flow from financial activity decreased in FY21 and stood at Rs -2,718 m as compared to Rs 792 m in FY20.

Here's the cash flow statement of ALKEM LABORATORIES for the past 5 years.

(Rs m)FY17FY18FY19FY20FY21
From Operations4,7112,6607,7975,85112,649
From Investments-2,859-3,572-3,164-7,414-9,985
From Financial Activity-1,379846-3,789792-2,718
Net Cashflow3961823-731-17

What does the Key Ratio analysis of ALKEM LABORATORIES reveal?

Be it the company's profitability, operations effectiveness or utilization of funds, ratio analysis is an important tool which helps in making investment decisions.

The ratio/financial analysis of ALKEM LABORATORIES reveals:

  • Operating profit margins witnessed a fall and down at 21.9% in FY21 as against 17.7% in FY20.
  • Net profit margins grew from 13.8% in FY20 to 18.2% in FY21.
  • Debt to Equity ratio for FY21 stood at 0.0 as compared to 0.0 in FY20.

Here's the ratio/financial analysis of ALKEM LABORATORIES for the past 5 years.

 FY17FY18FY19FY20FY21
Operating Profit Margin (%)18.115.815.217.721.9
Net Profit Margin (%)16.410.010.513.818.2
Debt to Equity Ratio (x)0.00.00.00.00.0

Read: Latest Annual Report Analysis of ALKEM LABORATORIES

 

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