LUPIN 2018-19 Annual Report Analysis

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LUPIN 2018-19 Annual Report Analysis
Thu, 18 Jul

LUPIN 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.

LUPIN Income Statement Analysis

  • Operating income during the year rose 5.8% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 8.4% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.2% in FY19 as against 19.9% in FY18.
  • Depreciation charges decreased by 0.1% and finance costs increased by 50.6% YoY, respectively.
  • Other income grew by 142.1% YoY.
  • Net profit for the year grew by 141.4% YoY.
  • Net profit margins during the year grew from 1.6% in FY18 to 3.6% in FY19.

LUPIN Income Statement 2018-19

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Net Sales Rs m 158,042 167,182 5.8%
Other income Rs m 1,504 3,640 142.1%
Total Revenues Rs m 159,545 170,822 7.1%
Gross profit Rs m 31,475 28,822 -8.4%
Depreciation Rs m 10,859 10,850 -0.1%
Interest Rs m 2,044 3,078 50.6%
Profit before tax Rs m 20,076 18,534 -7.7%
Tax Rs m 2,885 9,017 212.6%
Profit after tax Rs m 2,513 6,066 141.4%
Gross profit margin % 19.9 17.2
Effective tax rate % 14.4 48.7
Net profit margin % 1.6 3.6
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



LUPIN Balance Sheet Analysis

  • The company's current liabilities during FY19 stood at Rs 61 billion as compared to Rs 51 billion in FY18, thereby witnessing an increase of 20.3%.
  • Long-term debt stood at Rs 66 billion as compared to Rs 64 billion during FY18, a growth of 3.4%.
  • Current assets rose 13% and stood at Rs 139 billion, while fixed assets fell 2% and stood at Rs 128 billion in FY19.
  • Overall, the total assets and liabilities for FY19 stood at Rs 279 billion as against Rs 263 billion during FY18, thereby witnessing a growth of 6%.

LUPIN Balance Sheet as on March 2019

No. of Mths Year Ending 12 Mar-18* 12 Mar-19* % Change
Networth Rs m 135,771 137,422 1.2
 
Current Liabilities Rs m 50,956 61,299 20.3
Long-term Debt Rs m 64,245 66,417 3.4
Total Liabilities Rs m 263,054 279,494 6.2
 
Current assets Rs m 122,095 138,536 13.5
Fixed Assets Rs m 129,876 127,516 -1.8
Total Assets Rs m 263,054 279,494 6.2
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



LUPIN Cash Flow Statement Analysis

  • LUPIN's cash flow from operating activities (CFO) during FY19 stood at Rs 17 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY19 stood at Rs -33 billion on a YoY basis.
  • Cash flow from financial activities (CFF) during FY19 stood at Rs 7 billion, an improvement of 150% on a YoY basis.
  • Overall, net cash flows for the company during FY19 stood at Rs -9 billion from the Rs 7 billion net cash flows seen during FY18.

LUPIN 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 17,512 16,660 -4.9%
Cash Flow from Investing Activities Rs m 4,699 -32,825 -
Cash Flow from Financing Activities Rs m -14,921 7,441 -
Net Cash Flow Rs m 7,290 -8,724 -
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Current Valuations for LUPIN

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 13.4, an improvement from the EPS of Rs 5.6 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 761.6, stands at 41.3 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 2.8 times, while the price to sales ratio stands at 2.3 times.
  • The company's price to cash flow (P/CF) ratio stood at 20.2 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 349.6 369.5
TTM Earnings per share Rs 5.6 13.4
Diluted earnings per share Rs 5.6 13.4
Price to Cash Flow x 25.7 20.2
TTM P/E ratio x 41.4 41.3
Price / Book Value ratio x 3.6 2.8
Market Cap Rs m 344,304 343,587
Dividends per share (Unadj.) Rs 5.0 0.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



Ratio Analysis for LUPIN

  • Solvency Ratios
  • Current Ratio: The company's current ratio deteriorated and stood at 2.3x during FY19, from 2.4x 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 7.0x during FY19, from 10.8x 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 improved and stood at 4.4% during FY19, from 1.9% 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 8.9% during FY19, from 3.7% 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 3.3% during FY19, from 1.7% 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 2.4 2.3
Debtors’ Days Days 120 112
Interest coverage x 10.8 7.0
Debt to equity ratio x 0.5 0.5
Return on assets % 1.7 3.3
Return on equity % 1.9 4.4
Return on capital employed % 3.7 8.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Company Reports, Regulatory Filings, Equitymaster



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

LUPIN Share Price Performance

Over the last one year, LUPIN share price has moved down from Rs 809.8 to Rs 761.6, registering a loss of Rs 48.2 or around 6.0%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 13,056.2 (down 0.7%). Over the last one year it has moved down from 13,689.2 to 13,056.2, a loss of 633 points (down 4.6%).

Overall, the S&P BSE SENSEX is up 7.2% over the year.

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

Equitymaster requests your view! Post a comment on "LUPIN 2018-19 Annual Report Analysis". Click here!

1 Responses to "LUPIN 2018-19 Annual Report Analysis"

Rakesh Sinha

Jul 26, 2019

We have been sitting on Lupin shares for quite a while and value has been eroding consistently. Is there any recommended action? Should we buy more to average the price or just sell it and take the loss?

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Equitymaster requests your view! Post a comment on "LUPIN 2018-19 Annual Report Analysis". Click here!

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