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GLENMARK PHARMA 2020-21 Annual Report Analysis

Wed, 31 Mar

GLENMARK PHARMA 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.

GLENMARK PHARMA Income Statement Analysis

• Operating income during the year rose 2.8% on a year-on-year (YoY) basis.
• The company's operating profit increased by 23.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 19.5% in FY21 as against 16.3% in FY20.
• Depreciation charges increased by 6.3% and finance costs decreased by 6.4% YoY, respectively.
• Other income declined by 68.5% YoY.
• Net profit for the year grew by 25.0% YoY.
• Net profit margins during the year grew from 7.3% in FY20 to 8.9% in FY21.

GLENMARK PHARMA Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	106,410	109,439	2.8%
Other income	Rs m	1,596	502	-68.5%
Total Revenues	Rs m	108,006	109,941	1.8%
Gross profit	Rs m	17,310	21,289	23.0%
Depreciation	Rs m	4,172	4,436	6.3%
Interest	Rs m	3,773	3,531	-6.4%
Profit before tax	Rs m	10,961	13,825	26.1%
Tax	Rs m	3,201	4,124	28.8%
Profit after tax	Rs m	7,760	9,701	25.0%
Gross profit margin	%	16.3	19.5
Effective tax rate	%	29.2	29.8
Net profit margin	%	7.3	8.9

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GLENMARK PHARMA Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 42 billion as compared to Rs 41 billion in FY20, thereby witnessing an increase of 1.8%.
• Long-term debt down at Rs 39 billion as compared to Rs 40 billion during FY20, a fall of 3.8%.
• Current assets rose 8% and stood at Rs 74 billion, while fixed assets rose 4% and stood at Rs 67 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 141 billion as against Rs 132 billion during FY20, thereby witnessing a growth of 6%.

GLENMARK PHARMA Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	60,568	70,430	16.3
Current Liabilities	Rs m	41,260	42,010	1.8
Long-term Debt	Rs m	40,430	38,888	-3.8
Total Liabilities	Rs m	132,291	140,689	6.3
Current assets	Rs m	68,036	73,596	8.2
Fixed Assets	Rs m	64,255	67,093	4.4
Total Assets	Rs m	132,291	140,689	6.3

GLENMARK PHARMA Cash Flow Statement Analysis

• GLENMARK PHARMA's cash flow from operating activities (CFO) during FY21 stood at Rs 11 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -7 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs -4 billion, an improvement of 1% on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 278 million from the Rs 2 billion net cash flows seen during FY20.

GLENMARK PHARMA 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	13,924	11,312	-18.8%
Cash Flow from Investing Activities	Rs m	-7,835	-6,752	-
Cash Flow from Financing Activities	Rs m	-4,447	-4,418	-
Net Cash Flow	Rs m	1,740	278	-84.0%

Current Valuations for GLENMARK PHARMA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 34.4, an improvement from the EPS of Rs 27.5 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 464.6, stands at 13.5 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 1.9 times, while the price to sales ratio stands at 1.2 times.
• The company's price to cash flow (P/CF) ratio stood at 7.7 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	377.1	387.8
TTM Earnings per share	Rs	27.5	34.4
Diluted earnings per share	Rs	27.5	34.4
Price to Cash Flow	x	4.9	7.7
TTM P/E ratio	x	7.5	13.5
Price / Book Value ratio	x	1.9	1.5
Market Cap	Rs m	116,775	108,353
Dividends per share (Unadj.)	Rs	2.5	2.5

Ratio Analysis for GLENMARK PHARMA

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.8x during FY21, from 1.6x 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 4.9x during FY21, from 3.9x 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 13.8% during FY21, from 12.8% 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 15.9% during FY21, from 14.6% 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 9.4% during FY21, from 8.7% 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	1.6	1.8
Debtors’ Days	Days	83	86
Interest coverage	x	3.9	4.9
Debt to equity ratio	x	0.7	0.6
Return on assets	%	8.7	9.4
Return on equity	%	12.8	13.8
Return on capital employed	%	14.6	15.9

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

GLENMARK PHARMA Share Price Performance

Over the last one year, GLENMARK PHARMA share price has moved up from Rs 206.1 to Rs 464.6, registering a gain of Rs 258.5 or around 125.5%.

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 GLENMARK PHARMA and quarterly results for GLENMARK PHARMA)

Read: Latest Annual Report Analysis of GLENMARK PHARMA