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DR. REDDYS LAB 2021-22 Annual Report Analysis
Sun, 10 Jul

DR. REDDYS LAB 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.

DR. REDDYS LAB Income Statement Analysis

  • Operating income during the year rose 13.1% on a year-on-year (YoY) basis.
  • The company's operating profit decreased by 2.6% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 17.5% in FY22 as against 20.3% in FY21.
  • Depreciation charges decreased by 5.2% and finance costs decreased by 1.2% YoY, respectively.
  • Other income grew by 66.3% YoY.
  • Net profit for the year grew by 11.0% YoY.
  • Net profit margins during the year declined from 10.0% in FY21 to 9.8% in FY22.

DR. REDDYS LAB Income Statement 2021-22

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Net Sales Rs m 190,475 215,452 13.1%
Other income Rs m 2,914 4,847 66.3%
Total Revenues Rs m 193,389 220,299 13.9%
Gross profit Rs m 38,699 37,674 -2.6%
Depreciation Rs m 12,288 11,652 -5.2%
Interest Rs m 970 958 -1.2%
Profit before tax Rs m 28,355 29,911 5.5%
Tax Rs m 9,319 8,789 -5.7%
Profit after tax Rs m 19,036 21,122 11.0%
Gross profit margin % 20.3 17.5
Effective tax rate % 32.9 29.4
Net profit margin % 10.0 9.8
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



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

DR. REDDYS LAB Balance Sheet Analysis

  • The company's current liabilities during FY22 stood at Rs 98 billion as compared to Rs 81 billion in FY21, thereby witnessing an increase of 20.5%.
  • Long-term debt down at Rs 4 billion as compared to Rs 4 billion during FY21, a fall of 0.0%.
  • Current assets rose 22% and stood at Rs 178 billion, while fixed assets fell 3% and stood at Rs 107 billion in FY22.
  • Overall, the total assets and liabilities for FY22 stood at Rs 285 billion as against Rs 255 billion during FY21, thereby witnessing a growth of 11%.

DR. REDDYS LAB Balance Sheet as on March 2022

No. of Mths Year Ending 12 Mar-21* 12 Mar-22* % Change
Networth Rs m 175,151 190,691 8.9
 
Current Liabilities Rs m 81,038 97,658 20.5
Long-term Debt Rs m 3,800 3,800 0.0
Total Liabilities Rs m 255,482 284,699 11.4
 
Current assets Rs m 145,503 177,880 22.3
Fixed Assets Rs m 109,979 106,819 -2.9
Total Assets Rs m 255,482 284,699 11.4
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



DR. REDDYS LAB Cash Flow Statement Analysis

  • DR. REDDYS LAB's cash flow from operating activities (CFO) during FY22 stood at Rs 28 billion on a YoY basis.
  • Cash flow from investing activities (CFI) during FY22 stood at Rs -26 billion, an improvement of 16.4% on a YoY basis.
  • Cash flow from financial activities (CFF) during FY22 stood at Rs -2 billion on a YoY basis.
  • Overall, net cash flows for the company during FY22 stood at Rs 32 million from the Rs 13 billion net cash flows seen during FY21.

DR. REDDYS LAB 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 35,703 28,108 -21.3%
Cash Flow from Investing Activities Rs m -22,660 -26,387 -
Cash Flow from Financing Activities Rs m -298 -2,422 -
Net Cash Flow Rs m 12,858 32 -99.8%
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Current Valuations for DR. REDDYS LAB

  • The trailing twelve-month earnings per share (EPS) of the company stands at Rs 126.9, an improvement from the EPS of Rs 114.5 recorded last year.
  • The price to earnings (P/E) ratio, at the current price of Rs 4,403.5, stands at 34.7 times its trailing twelve months earnings.
  • The price to book value (P/BV) ratio at current price levels stands at 3.8 times, while the price to sales ratio stands at 3.4 times.
  • The company's price to cash flow (P/CF) ratio stood at 23.5 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 1,145.4 1,294.6
TTM Earnings per share Rs 114.5 126.9
Diluted earnings per share Rs 114.4 126.9
Price to Cash Flow x 24.0 23.5
TTM P/E ratio x 39.5 34.7
Price / Book Value ratio x 4.1 4.0
Market Cap Rs m 710,290 771,272
Dividends per share (Unadj.) Rs 25.0 30.0
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



Ratio Analysis for DR. REDDYS LAB

  • Solvency Ratios
  • Current Ratio: The company's current ratio improved and stood at 1.8x during FY22, from 1.8x 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 improved and stood at 32.2x during FY22, from 30.2x 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 improved and stood at 11.1% during FY22, from 10.9% 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 15.9% during FY22, from 16.4% 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 7.8% during FY22, from 7.8% 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 1.8 1.8
Debtors’ Days Days 95 113
Interest coverage x 30.2 32.2
Debt to equity ratio x 0.0 0.0
Return on assets % 7.8 7.8
Return on equity % 10.9 11.1
Return on capital employed % 16.4 15.9
* Results Consolidated
Interim results exclude extraordinary / exceptional items
Source: Accord Fintech, Equitymaster



To see how DR. REDDYS LAB has performed over the last 5 years, please visit here.

DR. REDDYS LAB Share Price Performance

Over the last one year, DR. REDDYS LAB share price has moved down from Rs 5,459.9 to Rs 4,403.5, registering a loss of Rs 1,056.4 or around 19.3%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 22,160.4 (up 0.4%). Over the last one year it has moved down from 25,875.4 to 22,160.4, a loss of 3,715 points (down 14.4%).

Overall, the S&P BSE SENSEX is up 3.1% over the year.

(To know more, check out historical annual results for DR. REDDYS LAB and quarterly results for DR. REDDYS LAB)

Annual Report FAQs

What is the current share price of DR. REDDYS LAB?

DR. REDDYS LAB currently trades at Rs 6,155.2 per share. You can check out the latest share price performance of DR. REDDYS LAB here...

What was the revenue of DR. REDDYS LAB in FY22? How does it compare to earlier years?

The revenues of DR. REDDYS LAB stood at Rs 220,299 m in FY22, which was up 13.9% compared to Rs 193,389 m reported in FY21.

DR. REDDYS LAB's revenue has grown from Rs 144,362 m in FY18 to Rs 220,299 m in FY22.

Over the past 5 years, the revenue of DR. REDDYS LAB has grown at a CAGR of 11.1%.

What was the net profit of DR. REDDYS LAB in FY22? How does it compare to earlier years?

The net profit of DR. REDDYS LAB stood at Rs 21,122 m in FY22, which was up 11.0% compared to Rs 19,036 m reported in FY21.

This compares to a net profit of Rs 19,699 m in FY20 and a net profit of Rs 19,062 m in FY19.

Over the past 5 years, DR. REDDYS LAB net profit has grown at a CAGR of 23.3%.

What does the cash flow statement of DR. REDDYS LAB 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 DR. REDDYS LAB reveals:

  • Cash flow from operations decreased in FY22 and stood at Rs 28,108 m as compared to Rs 35,703 m in FY21.
  • Cash flow from investments decreased in FY22 and stood at Rs -26,387 m as compared to Rs -22,660 m in FY21.
  • Cash flow from financial activity decreased in FY22 and stood at Rs -2,422 m as compared to Rs -298 m in FY21.

Here's the cash flow statement of DR. REDDYS LAB for the past 5 years.

(Rs m)FY18FY19FY20FY21FY22
From Operations18,03028,70429,84135,70328,108
From Investments-14,883-7,727-4,923-22,660-26,387
From Financial Activity-4,440-21,326-25,159-298-2,422
Net Cashflow-1,236-314-26612,85832

What does the Key Ratio analysis of DR. REDDYS LAB 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 DR. REDDYS LAB reveals:

  • Operating profit margins witnessed a fall and stood at 17.5% in FY22 as against 20.3% in FY21.
  • Net profit margins declined from 10.0% in FY21 to 9.8% in FY22.
  • Debt to Equity ratio for FY22 stood at 0.0 as compared to 0.0 in FY21.

Here's the ratio/financial analysis of DR. REDDYS LAB for the past 5 years.

 FY18FY19FY20FY21FY22
Operating Profit Margin (%)16.520.614.120.317.5
Net Profit Margin (%)6.412.311.210.09.8
Debt to Equity Ratio (x)0.20.20.00.00.0

Read: Latest Annual Report Analysis of DR. REDDYS LAB

 

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