LAURUS LABS 2021-22 Annual Report Analysis

Wed, 8 Jun

LAURUS LABS has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

LAURUS LABS Income Statement Analysis

• Operating income during the year rose 2.5% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 8.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 28.8% in FY22 as against 32.2% in FY21.
• Depreciation charges increased by 22.6% and finance costs increased by 50.2% YoY, respectively.
• Other income declined by 35.3% YoY.
• Net profit for the year declined by 15.4% YoY.
• Net profit margins during the year declined from 20.4% in FY21 to 16.9% in FY22.

LAURUS LABS Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	48,135	49,356	2.5%
Other income	Rs m	237	153	-35.3%
Total Revenues	Rs m	48,372	49,509	2.4%
Gross profit	Rs m	15,507	14,224	-8.3%
Depreciation	Rs m	2,051	2,515	22.6%
Interest	Rs m	682	1,024	50.2%
Profit before tax	Rs m	13,011	10,839	-16.7%
Tax	Rs m	3,173	2,514	-20.8%
Profit after tax	Rs m	9,838	8,324	-15.4%
Gross profit margin	%	32.2	28.8
Effective tax rate	%	24.4	23.2
Net profit margin	%	20.4	16.9

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LAURUS LABS Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 27 billion as compared to Rs 25 billion in FY21, thereby witnessing an increase of 9.1%.
• Long-term debt stood at Rs 6 billion as compared to Rs 4 billion during FY21, a growth of 39.0%.
• Current assets rose 9% and stood at Rs 33 billion, while fixed assets rose 35% and stood at Rs 36 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 70 billion as against Rs 58 billion during FY21, thereby witnessing a growth of 21%.

LAURUS LABS Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	25,926	33,420	28.9
Current Liabilities	Rs m	24,572	26,810	9.1
Long-term Debt	Rs m	4,292	5,963	39.0
Total Liabilities	Rs m	57,507	69,680	21.2
Current assets	Rs m	30,749	33,446	8.8
Fixed Assets	Rs m	26,758	36,234	35.4
Total Assets	Rs m	57,507	69,680	21.2

LAURUS LABS Cash Flow Statement Analysis

• LAURUS LABS 's cash flow from operating activities (CFO) during FY22 stood at Rs 9 billion, an improvement of 24.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -9 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs 303 million on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs 269 million from the Rs 468 million net cash flows seen during FY21.

LAURUS LABS Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	7,330	9,111	24.3%
Cash Flow from Investing Activities	Rs m	-9,410	-9,143	-
Cash Flow from Financing Activities	Rs m	2,547	303	-88.1%
Net Cash Flow	Rs m	468	269	-42.5%

Current Valuations for LAURUS LABS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 15.5, an decline from the EPS of Rs 18.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 545.4, stands at 35.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 8.8 times, while the price to sales ratio stands at 5.9 times.
• The company's price to cash flow (P/CF) ratio stood at 26.9 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	89.7	91.8
TTM Earnings per share	Rs	18.3	15.5
Diluted earnings per share	Rs	18.3	15.5
Price to Cash Flow	x	16.4	26.9
TTM P/E ratio	x	19.8	35.2
Price / Book Value ratio	x	18.6	8.7
Market Cap	Rs m	483,157	291,289
Dividends per share (Unadj.)	Rs	2.0	2.0

Ratio Analysis for LAURUS LABS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.2x during FY22, from 1.3x during FY21. 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 11.6x during FY22, from 20.1x during FY21. 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 24.9% during FY22, from 37.9% during FY22. 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 30.1% during FY22, from 45.3% during FY21. 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 13.4% during FY22, from 18.3% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	1.3	1.2
Debtors’ Days	Days	10	10
Interest coverage	x	20.1	11.6
Debt to equity ratio	x	0.2	0.2
Return on assets	%	18.3	13.4
Return on equity	%	37.9	24.9
Return on capital employed	%	45.3	30.1

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

LAURUS LABS Share Price Performance

Over the last one year, LAURUS LABS share price has moved down from Rs 608.5 to Rs 545.4, registering a loss of Rs 63.1 or around 10.4%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 21,846.8 (up 0.0%). Over the last one year it has moved down from 25,055.8 to 21,846.8, a loss of 3,209 points (down 12.8%).

Overall, the S&P BSE SENSEX is up 5.6% over the year.

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

Read: Latest Annual Report Analysis of LAURUS LABS