DIVIS LABORATORIES 2022-23 Annual Report Analysis

Mon, 7 Aug

DIVIS LABORATORIES 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.

DIVIS LABORATORIES Income Statement Analysis

• Operating income during the year fell 13.3% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 39.0% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 30.5% in FY23 as against 43.3% in FY22.
• Depreciation charges increased by 10.2% and finance costs decreased by 2.0% YoY, respectively.
• Other income grew by 197.4% YoY.
• Net profit for the year declined by 38.4% YoY.
• Net profit margins during the year declined from 33.0% in FY22 to 23.5% in FY23.

DIVIS LABORATORIES Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	89,598	77,675	-13.3%
Other income	Rs m	1,159	3,447	197.4%
Total Revenues	Rs m	90,757	81,122	-10.6%
Gross profit	Rs m	38,811	23,691	-39.0%
Depreciation	Rs m	3,115	3,432	10.2%
Interest	Rs m	20	20	-2.0%
Profit before tax	Rs m	36,835	23,686	-35.7%
Tax	Rs m	7,231	5,453	-24.6%
Profit after tax	Rs m	29,605	18,234	-38.4%
Gross profit margin	%	43.3	30.5
Effective tax rate	%	19.6	23.0
Net profit margin	%	33.0	23.5

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DIVIS LABORATORIES Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 15 billion as compared to Rs 25 billion in FY22, thereby witnessing an decrease of -37.5%.
• Current assets rose 1% and stood at Rs 97 billion, while fixed assets rose 2% and stood at Rs 51 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 149 billion as against Rs 146 billion during FY22, thereby witnessing a growth of 2%.

DIVIS LABORATORIES Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	117,282	127,671	8.9
Current Liabilities	Rs m	24,544	15,331	-37.5
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	146,191	148,565	1.6
Current assets	Rs m	96,104	97,437	1.4
Fixed Assets	Rs m	50,087	51,128	2.1
Total Assets	Rs m	146,191	148,565	1.6

DIVIS LABORATORIES Cash Flow Statement Analysis

• DIVIS LABORATORIES's cash flow from operating activities (CFO) during FY23 stood at Rs 25 billion, an improvement of 28.7% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -27 billion, an improvement of 23.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -8 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs -10 billion from the Rs -8 billion net cash flows seen during FY22.

DIVIS LABORATORIES 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	19,118	24,597	28.7%
Cash Flow from Investing Activities	Rs m	-21,949	-27,076	-
Cash Flow from Financing Activities	Rs m	-5,324	-7,972	-
Net Cash Flow	Rs m	-8,156	-10,451	-

Current Valuations for DIVIS LABORATORIES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 68.7, an decline from the EPS of Rs 111.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 3,874.0, stands at 56.4 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 8.1 times, while the price to sales ratio stands at 13.2 times.
• The company's price to cash flow (P/CF) ratio stood at 45.2 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	337.5	292.6
TTM Earnings per share	Rs	111.5	68.7
Diluted earnings per share	Rs	111.5	68.7
Price to Cash Flow	x	35.7	45.2
TTM P/E ratio	x	39.5	56.4
Price / Book Value ratio	x	10.2	7.7
Market Cap	Rs m	1,192,890	978,378
Dividends per share (Unadj.)	Rs	30.0	30.0

Ratio Analysis for DIVIS LABORATORIES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 6.4x during FY23, from 3.9x 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 deteriorated and stood at 1,209.5x during FY23, from 1,842.8x 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 14.3% during FY23, from 25.2% 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 18.6% during FY23, from 31.4% 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 12.3% during FY23, from 20.3% 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	3.9	6.4
Debtors’ Days	Days	987	842
Interest coverage	x	1,842.8	1,209.5
Debt to equity ratio	x	0.0	0.0
Return on assets	%	20.3	12.3
Return on equity	%	25.2	14.3
Return on capital employed	%	31.4	18.6

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

DIVIS LABORATORIES Share Price Performance

Over the last one year, DIVIS LABORATORIES share price has moved down from Rs 3,911.1 to Rs 3,874.0, registering a loss of Rs 37.1 or around 0.9%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 28,250.3 (up 1.4%). Over the last one year it has moved up from 23,184.7 to 28,250.3, a gain of 5,066 points (up 21.8%).

Overall, the S&P BSE SENSEX is up 13.1% over the year.

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