NATCO PHARMA 2022-23 Annual Report Analysis

Thu, 7 Sep

NATCO PHARMA 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.

NATCO PHARMA Income Statement Analysis

• Operating income during the year rose 39.2% on a year-on-year (YoY) basis.
• The company's operating profit increased by 246.0% YoY during the fiscal. Operating profit margins witnessed a fall and down at 33.7% in FY23 as against 13.5% in FY22.
• Depreciation charges increased by 14.9% and finance costs decreased by 18.1% YoY, respectively.
• Other income grew by 29.8% YoY.
• Net profit for the year grew by 320.8% YoY.
• Net profit margins during the year grew from 8.7% in FY22 to 26.4% in FY23.

NATCO PHARMA Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	19,448	27,071	39.2%
Other income	Rs m	990	1,285	29.8%
Total Revenues	Rs m	20,438	28,356	38.7%
Gross profit	Rs m	2,635	9,117	246.0%
Depreciation	Rs m	1,426	1,638	14.9%
Interest	Rs m	177	145	-18.1%
Profit before tax	Rs m	2,022	8,619	326.3%
Tax	Rs m	322	1,466	355.3%
Profit after tax	Rs m	1,700	7,153	320.8%
Gross profit margin	%	13.5	33.7
Effective tax rate	%	15.9	17.0
Net profit margin	%	8.7	26.4

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NATCO PHARMA Balance Sheet Analysis

• The company's current liabilities during FY23 down at Rs 7 billion as compared to Rs 7 billion in FY22, thereby witnessing an decrease of -3.8%.
• Current assets rose 21% and stood at Rs 30 billion, while fixed assets rose 1% and stood at Rs 27 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 57 billion as against Rs 51 billion during FY22, thereby witnessing a growth of 11%.

NATCO PHARMA Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	42,602	48,738	14.4
Current Liabilities	Rs m	7,104	6,831	-3.8
Long-term Debt	Rs m	0	0	0.0
Total Liabilities	Rs m	51,091	56,574	10.7
Current assets	Rs m	24,867	30,003	20.7
Fixed Assets	Rs m	26,224	26,571	1.3
Total Assets	Rs m	51,091	56,574	10.7

NATCO PHARMA Cash Flow Statement Analysis

• NATCO PHARMA's cash flow from operating activities (CFO) during FY23 stood at Rs 8 billion, an improvement of 1,726.0% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -5 billion, an improvement of 8,901.9% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs -4 billion on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 208 million from the Rs 853 million net cash flows seen during FY22.

NATCO PHARMA 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	465	8,491	1,726.0%
Cash Flow from Investing Activities	Rs m	-53	-4,771	-
Cash Flow from Financing Activities	Rs m	348	-3,630	-
Net Cash Flow	Rs m	853	208	-75.6%

Current Valuations for NATCO PHARMA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 39.2, an improvement from the EPS of Rs 9.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 920.0, stands at 20.2 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.4 times, while the price to sales ratio stands at 6.2 times.
• The company's price to cash flow (P/CF) ratio stood at 14.0 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	106.6	148.4
TTM Earnings per share	Rs	9.3	39.2
Diluted earnings per share	Rs	9.5	39.9
Price to Cash Flow	x	43.4	14.0
TTM P/E ratio	x	79.8	20.2
Price / Book Value ratio	x	4.2	2.5
Market Cap	Rs m	176,990	123,049
Dividends per share (Unadj.)	Rs	4.5	5.5

Ratio Analysis for NATCO PHARMA

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 4.4x during FY23, from 3.5x 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 improved and stood at 60.4x during FY23, from 12.4x 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 improved and stood at 14.7% during FY23, from 4.0% 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 improved and stood at 18.0% during FY23, from 5.2% 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 improved and stood at 12.9% during FY23, from 3.7% 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	3.5	4.4
Debtors’ Days	Days	116	115
Interest coverage	x	12.4	60.4
Debt to equity ratio	x	0.0	0.0
Return on assets	%	3.7	12.9
Return on equity	%	4.0	14.7
Return on capital employed	%	5.2	18.0

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

NATCO PHARMA Share Price Performance

Over the last one year, NATCO PHARMA share price has moved up from Rs 612.2 to Rs 920.0, registering a gain of Rs 307.9 or around 50.3%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 28,380.5 (up 0.1%). Over the last one year it has moved up from 23,064.2 to 28,380.5, a gain of 5,316 points (up 23.1%).

Overall, the S&P BSE SENSEX is up 11.2% over the year.

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