CIPLA 2018-19 Annual Report Analysis

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CIPLA 2018-19 Annual Report Analysis
Mon, 9 Sep

CIPLA has announced its results for the year ended March 2019. Let us have a look at the detailed performance review of the company during FY18-19.

CIPLA Income Statement Analysis

  • Operating income during the year rose 8.3% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 9.6% YoY during the fiscal. Operating profit margins witnessed a fall and down at 19.4% in FY19 as against 19.2% in FY18.
  • Depreciation charges increased by 0.3% and finance costs increased by 47.4% YoY, respectively.
  • Other income grew by 33.3% YoY.
  • Net profit for the year grew by 5.4% YoY.
  • Net profit margins during the year declined from 9.4% in FY18 to 9.1% in FY19.

CIPLA Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 147,509 159,710 8.3%
Other income Rs m 3,577 4,766 33.3%
Total Revenues Rs m 151,085 164,475 8.9%
Gross profit Rs m 28,264 30,973 9.6%
Depreciation Rs m 13,228 13,263 0.3%
Interest Rs m 1,142 1,684 47.4%
Profit before tax Rs m 17,470 20,791 19.0%
Tax Rs m 2,501 5,695 127.7%
Profit after tax Rs m 14,166 14,924 5.4%
Gross profit margin % 19.2 19.4
Effective tax rate % 14.3 27.4
Net profit margin % 9.4 9.1
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



CIPLA Balance Sheet Analysis

  • The company's current liabilities during FY19 down at Rs 38 billion as compared to Rs 38 billion in FY18, thereby witnessing an decrease of -1.6%.
  • Long-term debt stood at Rs 38 billion as compared to Rs 37 billion during FY18, a growth of 4.6%.
  • Current assets rose 15% and stood at Rs 124 billion, while fixed assets fell 4% and stood at Rs 105 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 240 billion as against Rs 229 billion during FY18, thereby witnessing a growth of 5%.

CIPLA Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 142,292 150,123 5.5
 
Current Liabilities Rs m 38,322 37,715 -1.6
Long-term Debt Rs m 36,621 38,301 4.6
Total Liabilities Rs m 228,606 239,633 4.8
 
Current assets Rs m 108,141 124,266 14.9
Fixed Assets Rs m 109,411 105,190 -3.9
Total Assets Rs m 228,606 239,633 4.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



CIPLA Cash Flow Statement Analysis

  • CIPLA's cash flow from operating activities (CFO) during FY19 stood at Rs 17 billion, an improvement of 15.6% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -17 billion, an improvement of 95.4% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs -3 billion, an improvement of 10% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -3 billion from the Rs 2 billion net cash flows seen during FY18.

CIPLA Cash Flow Statement 2018-19

Particulars No. of months 12 12 % Change
Year Ending Mar-18 Mar-19
Cash Flow from Operating Activities Rs m 14,628 16,911 15.6%
Cash Flow from Investing Activities Rs m -8,540 -16,687 -
Cash Flow from Financing Activities Rs m -3,855 -3,487 -
Net Cash Flow Rs m 2,431 -3,451 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for CIPLA

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 18.5, an improvement from the EPS of Rs 17.6 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 476.9, stands at 25.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.1 times, while the price to sales ratio stands at 2.9 times.
  • The company's price to cash flow (P/CF) ratio stood at 13.5 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Sales per share (Unadj.) Rs 183.2 198.2
TTM Earnings per share Rs 17.6 18.5
Diluted earnings per share Rs 17.6 18.6
Price to Cash Flow x 14.0 13.5
TTM P/E ratio x 25.0 25.0
Price / Book Value ratio x 3.2 3.1
Market Cap Rs m 383,962 383,528
Dividends per share (Unadj.) Rs 3.0 3.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for CIPLA

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 3.3x during FY19, from 2.8x during FY18. 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 deteriorated and stood at 13.3x during FY19, from 16.3x during FY18. 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 9.9% during FY19, from 10.0% during FY19. 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 11.8% during FY19, from 10.0% during FY18. 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 6.9% during FY19, from 6.7% during FY18. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending 12 Mar-18* 12 Mar-19*
Current ratio x 2.8 3.3
Debtors’ Days Days 77 95
Interest coverage x 16.3 13.3
Debt to equity ratio x 0.3 0.3
Return on assets % 6.7 6.9
Return on equity % 10.0 9.9
Return on capital employed % 10.0 11.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

CIPLA Share Price Performance

Over the last one year, CIPLA share price has moved down from Rs 663.9 to Rs 476.9, registering a loss of Rs 187.0 or around 28.2%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 13,007.0 (up 0.4%). Over the last one year it has moved down from 16,311.1 to 13,007.0, a loss of 3,304 points (down 20.3%).

Overall, the S&P BSE SENSEX is down 2.7% over the year.

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

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