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IPCA LABS 2020-21 Annual Report Analysis
Wed, 31 Mar

IPCA LABS 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.

IPCA LABS Income Statement Analysis

  • Operating income during the year rose 17.0% on a year-on-year (YoY) basis.
  • The company's operating profit increased by 66.3% YoY during the fiscal. Operating profit margins witnessed a fall and down at 27.6% in FY21 as against 19.4% in FY20.
  • Depreciation charges decreased by 0.6% and finance costs decreased by 37.9% YoY, respectively.
  • Other income grew by 49.4% YoY.
  • Net profit for the year grew by 87.9% YoY.
  • Net profit margins during the year grew from 13.3% in FY20 to 21.4% in FY21.

IPCA LABS Income Statement 2020-21

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Net Sales Rs m 45,894 53,699 17.0%
Other income Rs m 865 1,292 49.4%
Total Revenues Rs m 46,759 54,991 17.6%
Gross profit Rs m 8,905 14,812 66.3%
Depreciation Rs m 2,105 2,092 -0.6%
Interest Rs m 198 123 -37.9%
Profit before tax Rs m 7,467 13,890 86.0%
Tax Rs m 1,353 2,401 77.4%
Profit after tax Rs m 6,114 11,488 87.9%
Gross profit margin % 19.4 27.6
Effective tax rate % 18.1 17.3
Net profit margin % 13.3 21.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

IPCA LABS Balance Sheet Analysis

  • The company's current liabilities during FY21 down at Rs 11 billion as compared to Rs 13 billion in FY20, thereby witnessing an decrease of -14.6%.
  • Long-term debt down at Rs 365 million as compared to Rs 1 billion during FY20, a fall of 64.5%.
  • Current assets rose 20% and stood at Rs 34 billion, while fixed assets rose 9% and stood at Rs 26 billion in FY21.
  • Overall, the total assets and liabilities for FY21 stood at Rs 61 billion as against Rs 53 billion during FY20, thereby witnessing a growth of 15%.

IPCA LABS Balance Sheet as on March 2021

No. of Mths Year Ending 12 Mar-20* 12 Mar-21* % Change
Networth Rs m 36,155 47,017 30.0
 
Current Liabilities Rs m 13,264 11,331 -14.6
Long-term Debt Rs m 1,030 365 -64.5
Total Liabilities Rs m 52,578 60,664 15.4
 
Current assets Rs m 28,557 34,370 20.4
Fixed Assets Rs m 24,021 26,295 9.5
Total Assets Rs m 52,578 60,664 15.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



IPCA LABS Cash Flow Statement Analysis

  • IPCA LABS's cash flow from operating activities (CFO) during FY21 stood at Rs 11 billion, an improvement of 91.1% on a YoY basis.
  • Cash flow from investing activities (CFI) during FY21 stood at Rs -5 billion, an improvement of 2.2% 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 3 billion from the Rs -755 million net cash flows seen during FY20.

IPCA LABS 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 5,704 10,901 91.1%
Cash Flow from Investing Activities Rs m -5,097 -5,207 -
Cash Flow from Financing Activities Rs m -1,365 -3,058 -
Net Cash Flow Rs m -755 2,636 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for IPCA LABS

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 90.6, an improvement from the EPS of Rs 48.4 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 1,902.8, stands at 42.0 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 10.3 times, while the price to sales ratio stands at 4.5 times.
  • The company's price to cash flow (P/CF) ratio stood at 17.9 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 363.2 423.3
TTM Earnings per share Rs 48.4 90.6
Diluted earnings per share Rs 24.1 45.3
Price to Cash Flow x 42.8 17.9
TTM P/E ratio x 57.6 42.0
Price / Book Value ratio x 4.3 5.2
Market Cap Rs m 155,407 242,728
Dividends per share (Unadj.) Rs 2.5 4.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for IPCA LABS

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 3.0x during FY21, from 2.2x 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 114.2x during FY21, from 38.8x 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 24.4% during FY21, from 16.9% 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 29.6% during FY21, from 20.6% 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 19.1% during FY21, from 12.0% 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 2.2 3.0
Debtors’ Days Days 7 6
Interest coverage x 38.8 114.2
Debt to equity ratio x 0.0 0.0
Return on assets % 12.0 19.1
Return on equity % 16.9 24.4
Return on capital employed % 20.6 29.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

IPCA LABS Share Price Performance

Over the last one year, IPCA LABS share price has moved up from Rs 1,388.1 to Rs 1,902.8, registering a gain of Rs 514.7 or around 37.1%.

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 IPCA LABS and quarterly results for IPCA LABS)

Annual Report FAQs

What is the current share price of IPCA LABS?

IPCA LABS currently trades at Rs 1,238.3 per share. You can check out the latest share price performance of IPCA LABS here...

What was the revenue of IPCA LABS in FY21? How does it compare to earlier years?

The revenues of IPCA LABS stood at Rs 54,991 m in FY21, which was up 17.6% compared to Rs 46,759 m reported in FY20.

IPCA LABS' revenue has grown from Rs 31,549 m in FY17 to Rs 54,991 m in FY21.

Over the past 5 years, the revenue of IPCA LABS has grown at a CAGR of 14.9%.

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

The net profit of IPCA LABS stood at Rs 11,488 m in FY21, which was up 87.9% compared to Rs 6,114 m reported in FY20.

This compares to a net profit of Rs 4,440 m in FY19 and a net profit of Rs 2,437 m in FY18.

Over the past 5 years, IPCA LABS net profit has grown at a CAGR of 54.3%.

What does the cash flow statement of IPCA LABS 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 IPCA LABS reveals:

  • Cash flow from operations increased in FY21 and stood at Rs 10,901 m as compared to Rs 5,704 m in FY20.
  • Cash flow from investments decreased in FY21 and stood at Rs -5,207 m as compared to Rs -5,097 m in FY20.
  • Cash flow from financial activity decreased in FY21 and stood at Rs -3,058 m as compared to Rs -1,365 m in FY20.

Here's the cash flow statement of IPCA LABS for the past 5 years.

(Rs m)FY17FY18FY19FY20FY21
From Operations2,8193,4115,0105,70410,901
From Investments-1,488-1,354-1,651-5,097-5,207
From Financial Activity-1,591-1,304-1,832-1,365-3,058
Net Cashflow-2607531,528-7552,636

What does the Key Ratio analysis of IPCA LABS 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 IPCA LABS reveals:

  • Operating profit margins witnessed a fall and down at 27.6% in FY21 as against 19.4% in FY20.
  • Net profit margins grew from 13.3% in FY20 to 21.4% 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 IPCA LABS for the past 5 years.

 FY17FY18FY19FY20FY21
Operating Profit Margin (%)13.413.718.219.427.6
Net Profit Margin (%)6.57.511.913.321.4
Debt to Equity Ratio (x)0.10.10.00.00.0

Read: Latest Annual Report Analysis of IPCA LABS

 

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