TORRENT PHARMA 2022-23 Annual Report Analysis

Mon, 17 Jul

TORRENT 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.

TORRENT PHARMA Income Statement Analysis

• Operating income during the year rose 13.1% on a year-on-year (YoY) basis.
• The company's operating profit increased by 45.1% YoY during the fiscal. Operating profit margins witnessed a fall and down at 29.4% in FY23 as against 22.9% in FY22.
• Depreciation charges increased by 6.7% and finance costs increased by 30.7% YoY, respectively.
• Other income declined by 67.8% YoY.
• Net profit for the year grew by 60.2% YoY.
• Net profit margins during the year grew from 9.1% in FY22 to 12.9% in FY23.

TORRENT PHARMA Income Statement 2022-23

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Net Sales	Rs m	85,080	96,202	13.1%
Other income	Rs m	1,966	632	-67.8%
Total Revenues	Rs m	87,046	96,834	11.2%
Gross profit	Rs m	19,466	28,240	45.1%
Depreciation	Rs m	6,622	7,066	6.7%
Interest	Rs m	2,551	3,334	30.7%
Profit before tax	Rs m	12,259	18,472	50.7%
Tax	Rs m	4,487	6,019	34.1%
Profit after tax	Rs m	7,772	12,452	60.2%
Gross profit margin	%	22.9	29.4
Effective tax rate	%	36.6	32.6
Net profit margin	%	9.1	12.9

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TORRENT PHARMA Balance Sheet Analysis

• The company's current liabilities during FY23 stood at Rs 54 billion as compared to Rs 44 billion in FY22, thereby witnessing an increase of 23.4%.
• Long-term debt stood at Rs 25 billion as compared to Rs 21 billion during FY22, a growth of 17.6%.
• Current assets rose 3% and stood at Rs 53 billion, while fixed assets rose 25% and stood at Rs 91 billion in FY23.
• Overall, the total assets and liabilities for FY23 stood at Rs 145 billion as against Rs 126 billion during FY22, thereby witnessing a growth of 15%.

TORRENT PHARMA Balance Sheet as on March 2023

No. of Mths Year Ending		12 Mar-22*	12 Mar-23*	% Change
Networth	Rs m	59,530	61,981	4.1
Current Liabilities	Rs m	44,151	54,473	23.4
Long-term Debt	Rs m	21,232	24,962	17.6
Total Liabilities	Rs m	126,062	144,682	14.8
Current assets	Rs m	51,650	53,137	2.9
Fixed Assets	Rs m	73,115	91,390	25.0
Total Assets	Rs m	126,062	144,682	14.8

TORRENT PHARMA Cash Flow Statement Analysis

• TORRENT PHARMA's cash flow from operating activities (CFO) during FY23 stood at Rs 24 billion, an improvement of 31.3% on a YoY basis.
• Cash flow from investing activities (CFI) during FY23 stood at Rs -24 billion, an improvement of 1,128.4% on a YoY basis.
• Cash flow from financial activities (CFF) during FY23 stood at Rs 774 million, an improvement of 104% on a YoY basis.
• Overall, net cash flows for the company during FY23 stood at Rs 1 billion from the Rs -2 billion net cash flows seen during FY22.

TORRENT 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	18,030	23,681	31.3%
Cash Flow from Investing Activities	Rs m	-1,966	-24,153	-
Cash Flow from Financing Activities	Rs m	-17,811	774	-
Net Cash Flow	Rs m	-1,742	1,101	-

Current Valuations for TORRENT PHARMA

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 36.8, an decline from the EPS of Rs 45.9 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 1,938.5, stands at 53.1 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 10.6 times, while the price to sales ratio stands at 6.8 times.
• The company's price to cash flow (P/CF) ratio stood at 25.7 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	502.8	284.2
TTM Earnings per share	Rs	45.9	36.8
Diluted earnings per share	Rs	23.0	36.8
Price to Cash Flow	x	32.9	25.7
TTM P/E ratio	x	60.9	53.1
Price / Book Value ratio	x	8.2	8.1
Market Cap	Rs m	489,231	501,779
Dividends per share (Unadj.)	Rs	48.0	22.0

Ratio Analysis for TORRENT PHARMA

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 1.0x during FY23, from 1.2x 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 6.5x during FY23, from 5.8x 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 20.1% during FY23, from 13.1% 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 25.1% during FY23, from 18.3% 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 10.9% during FY23, from 8.2% 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	1.2	1.0
Debtors’ Days	Days	7	7
Interest coverage	x	5.8	6.5
Debt to equity ratio	x	0.4	0.4
Return on assets	%	8.2	10.9
Return on equity	%	13.1	20.1
Return on capital employed	%	18.3	25.1

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

TORRENT PHARMA Share Price Performance

Over the last one year, TORRENT PHARMA share price has moved up from Rs 1,516.8 to Rs 1,938.5, registering a gain of Rs 421.8 or around 27.8%.

Meanwhile, the S&P BSE HEALTHCARE Index is trading at Rs 26,443.1 (up 0.8%). Over the last one year it has moved up from 22,591.9 to 26,443.1, a gain of 3,851 points (up 17.0%).

Overall, the S&P BSE SENSEX is up 24.4% over the year.

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