ALEMBIC PHARMA 2017-18 Annual Report Analysis

Sat, 31 Mar

ALEMBIC PHARMA 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.

ALEMBIC PHARMA Income Statement Analysis

• Operating income during the year fell 0.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 0.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 19.7% in FY18 as against 19.6% in FY17.
• Depreciation charges increased by 27.1% and finance costs decreased by 35.0% YoY, respectively.
• Other income grew by 1251.6% YoY.
• Net profit for the year grew by 3.4% YoY.
• Net profit margins during the year grew from 13.0% in FY17 to 13.4% in FY18.

ALEMBIC PHARMA Income Statement 2017-18

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Net Sales	Rs m	31,346	31,308	-0.1%
Other income	Rs m	26	349	1,251.6%
Total Revenues	Rs m	31,372	31,657	0.9%
Gross profit	Rs m	6,147	6,153	0.1%
Depreciation	Rs m	830	1,055	27.1%
Interest	Rs m	52	34	-35.0%
Profit before tax	Rs m	5,291	5,413	2.3%
Tax	Rs m	1,222	1,204	-1.5%
Profit after tax	Rs m	4,069	4,209	3.4%
Gross profit margin	%	19.6	19.7
Effective tax rate	%	23.1	22.2
Net profit margin	%	13.0	13.4

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ALEMBIC PHARMA Balance Sheet Analysis

• The company's current liabilities during FY18 stood at Rs 13 billion as compared to Rs 8 billion in FY17, thereby witnessing an increase of 55.7%.
• Long-term debt stood at Rs 5 billion as compared to Rs 0 million during FY17, a fall of 0.0%.
• Current assets rose 30% and stood at Rs 19 billion, while fixed assets rose 61% and stood at Rs 21 billion in FY18.
• Overall, the total assets and liabilities for FY18 stood at Rs 41 billion as against Rs 28 billion during FY17, thereby witnessing a growth of 45%.

ALEMBIC PHARMA Balance Sheet as on March 2018

No. of Mths Year Ending		12 Mar-17*	12 Mar-18*	% Change
Networth	Rs m	19,023	22,201	16.7
Current Liabilities	Rs m	8,140	12,672	55.7
Long-term Debt	Rs m	0	5,000	0.0
Total Liabilities	Rs m	28,106	40,638	44.6
Current assets	Rs m	14,938	19,475	30.4
Fixed Assets	Rs m	13,168	21,163	60.7
Total Assets	Rs m	28,106	40,638	44.6

ALEMBIC PHARMA Cash Flow Statement Analysis

• ALEMBIC PHARMA's cash flow from operating activities (CFO) during FY18 stood at Rs 3 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY18 stood at Rs -9 billion, an improvement of 82.0% on a YoY basis.
• Cash flow from financial activities (CFF) during FY18 stood at Rs 5 billion, an improvement of 490% on a YoY basis.
• Overall, net cash flows for the company during FY18 stood at Rs -693 million from the Rs -3 billion net cash flows seen during FY17.

ALEMBIC PHARMA 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	3,286	3,124	-4.9%
Cash Flow from Investing Activities	Rs m	-4,859	-8,844	-
Cash Flow from Financing Activities	Rs m	-1,289	5,026	-
Net Cash Flow	Rs m	-2,862	-693	-

Current Valuations for ALEMBIC PHARMA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 22.3, an improvement from the EPS of Rs 21.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 549.8, stands at 25.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 4.9 times, while the price to sales ratio stands at 3.3 times.
• The company's price to cash flow (P/CF) ratio stood at 20.0 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	166.3	166.1
TTM Earnings per share	Rs	21.6	22.3
Diluted earnings per share	Rs	20.7	21.4
Price to Cash Flow	x	25.0	20.0
TTM P/E ratio	x	30.2	25.7
Price / Book Value ratio	x	6.1	4.7
Market Cap	Rs m	115,452	105,079
Dividends per share (Unadj.)	Rs	4.0	4.0

Ratio Analysis for ALEMBIC PHARMA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.5x during FY18, from 1.8x 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 improved and stood at 160.2x during FY18, from 102.2x 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 19.0% during FY18, from 21.4% 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 declined and down at 20.0% during FY18, from 28.1% 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 declined and down at 10.4% during FY18, from 14.7% 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	1.8	1.5
Debtors’ Days	Days	4	6
Interest coverage	x	102.2	160.2
Debt to equity ratio	x	0.0	0.2
Return on assets	%	14.7	10.4
Return on equity	%	21.4	19.0
Return on capital employed	%	28.1	20.0

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

ALEMBIC PHARMA Share Price Performance

Over the last one year, ALEMBIC PHARMA share price has moved down from Rs 623.7 to Rs 549.8, registering a loss of Rs 73.9 or around 11.8%.

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 ALEMBIC PHARMA and quarterly results for ALEMBIC PHARMA)

Read: Latest Annual Report Analysis of ALEMBIC PHARMA