SOLARA ACTIVE PHARMA SCIENCES 2020-21 Annual Report Analysis

Wed, 31 Mar

SOLARA ACTIVE PHARMA SCIENCES 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.

SOLARA ACTIVE PHARMA SCIENCES Income Statement Analysis

• Operating income during the year rose 22.3% on a year-on-year (YoY) basis.
• The company's operating profit increased by 48.7% YoY during the fiscal. Operating profit margins witnessed a fall and down at 23.9% in FY21 as against 19.6% in FY20.
• Depreciation charges increased by 15.4% and finance costs increased by 8.5% YoY, respectively.
• Other income grew by 4.5% YoY.
• Net profit for the year grew by 93.3% YoY.
• Net profit margins during the year grew from 8.7% in FY20 to 13.7% in FY21.

SOLARA ACTIVE PHARMA SCIENCES Income Statement 2020-21

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Net Sales	Rs m	13,218	16,169	22.3%
Other income	Rs m	275	288	4.5%
Total Revenues	Rs m	13,493	16,457	22.0%
Gross profit	Rs m	2,594	3,859	48.7%
Depreciation	Rs m	942	1,087	15.4%
Interest	Rs m	779	845	8.5%
Profit before tax	Rs m	1,149	2,215	92.8%
Tax	Rs m	4	2	-61.5%
Profit after tax	Rs m	1,145	2,214	93.3%
Gross profit margin	%	19.6	23.9
Effective tax rate	%	0.3	0.1
Net profit margin	%	8.7	13.7

SOLARA ACTIVE PHARMA SCIENCES Balance Sheet Analysis

• The company's current liabilities during FY21 stood at Rs 8 billion as compared to Rs 7 billion in FY20, thereby witnessing an increase of 8.1%.
• Long-term debt down at Rs 2 billion as compared to Rs 2 billion during FY20, a fall of 33.5%.
• Current assets rose 57% and stood at Rs 11 billion, while fixed assets rose 3% and stood at Rs 15 billion in FY21.
• Overall, the total assets and liabilities for FY21 stood at Rs 26 billion as against Rs 22 billion during FY20, thereby witnessing a growth of 20%.

SOLARA ACTIVE PHARMA SCIENCES Balance Sheet as on March 2021

No. of Mths Year Ending		12 Mar-20*	12 Mar-21*	% Change
Networth	Rs m	9,852	15,847	60.9
Current Liabilities	Rs m	7,299	7,888	8.1
Long-term Debt	Rs m	2,327	1,548	-33.5
Total Liabilities	Rs m	21,534	25,880	20.2
Current assets	Rs m	6,720	10,576	57.4
Fixed Assets	Rs m	14,814	15,303	3.3
Total Assets	Rs m	21,534	25,880	20.2

SOLARA ACTIVE PHARMA SCIENCES Cash Flow Statement Analysis

• SOLARA ACTIVE PHARMA SCIENCES's cash flow from operating activities (CFO) during FY21 stood at Rs 2 billion on a YoY basis.
• Cash flow from investing activities (CFI) during FY21 stood at Rs -1 billion on a YoY basis.
• Cash flow from financial activities (CFF) during FY21 stood at Rs 925 million on a YoY basis.
• Overall, net cash flows for the company during FY21 stood at Rs 1 billion from the Rs -197 million net cash flows seen during FY20.

SOLARA ACTIVE PHARMA SCIENCES 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	2,422	1,555	-35.8%
Cash Flow from Investing Activities	Rs m	-3,588	-1,063	-
Cash Flow from Financing Activities	Rs m	970	925	-4.6%
Net Cash Flow	Rs m	-197	1,417	-

Current Valuations for SOLARA ACTIVE PHARMA SCIENCES

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 61.6, an improvement from the EPS of Rs 42.6 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,394.3, stands at 22.7 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.2 times, while the price to sales ratio stands at 3.1 times.
• The company's price to cash flow (P/CF) ratio stood at 11.1 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	492.1	450.0
TTM Earnings per share	Rs	42.6	61.6
Diluted earnings per share	Rs	31.8	61.5
Price to Cash Flow	x	7.6	11.1
TTM P/E ratio	x	13.9	22.7
Price / Book Value ratio	x	1.4	2.3
Market Cap	Rs m	13,590	36,648
Dividends per share (Unadj.)	Rs	2.0	7.0

Ratio Analysis for SOLARA ACTIVE PHARMA SCIENCES

• Solvency Ratios

Current Ratio: The company's current ratio improved and stood at 1.3x during FY21, from 0.9x 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 3.6x during FY21, from 2.5x 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 14.0% during FY21, from 11.6% 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 17.6% during FY21, from 15.8% 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 11.8% during FY21, from 8.9% 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	0.9	1.3
Debtors’ Days	Days	6	11
Interest coverage	x	2.5	3.6
Debt to equity ratio	x	0.2	0.1
Return on assets	%	8.9	11.8
Return on equity	%	11.6	14.0
Return on capital employed	%	15.8	17.6

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

SOLARA ACTIVE PHARMA SCIENCES Share Price Performance

Over the last one year, SOLARA ACTIVE PHARMA SCIENCES share price has moved up from Rs 443.2 to Rs 1,394.3, registering a gain of Rs 951.1 or around 214.6%.

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 SOLARA ACTIVE PHARMA SCIENCES and quarterly results for SOLARA ACTIVE PHARMA SCIENCES)

Read: Latest Annual Report Analysis of SOLARA ACTIVE PHARMA SCIENCES