4QFY2011 Financials Snapshot:
| Y/E March (`cr) | 4QFY2011 | 3QFY2011 | % chg qoq | 4QFY2010 | % chg yoy |
| Net Sales | 1,512 | 1,467 | 3.0 | 1,286 | 17.5 |
| Other Income | 45 | 46 | (2.4) | 54 | (15.9) |
| Operating Profit | 269 | 254 | 5.7 | 250 | 7.4 |
| Interest | 8 | 8 | 0.5 | 8 | 0.1 |
| Net Profit | 227 | 224 | 1.4 | 221 | 3.0 |
4QFY2011 Financials Actuals v/s Estimates
| (` cr) | Actual | Estimates | Variation |
| Net Sales | 1,512 | 1,489 | 1.5 |
| Other Income | 45 | 54 | (16.1) |
| Operating Profit | 269 | 277 | (3.0) |
| Interest | 7.8 | 8 | (5.1) |
| Tax | 31 | 32 | (2.4) |
| Net Profit | 227 | 239 | (4.8) |
4QFY2011 Consolidated Financial Result Highlights-
· The Net Sales for the quarter under review for the company stood at `1,512cr (`1286cr) an increase of 17.5% yoy, higher than our estimates of `1489cr. This was backed by the growth in the domestic (grew by 20%) and advanced markets (grew by 10%) formulations segment. For the full year, the net sales increased by 19.5% yoy to `5707cr.
· The company reported gross margins of 59.3% compared to 62.0% in the same quarter last year. As a result OPM contracted to 17.8% (19.5%) for the quarter, lower than our estimates of 18.6%. For FY2011, the gross margins came in at 60.8% (58.7%), translating to OPM of 18.7% (18.6%).
· The net profit that came in at `227cr (`220.6cr), increase of 3%, lower than our estimates of `239cr for the quarter. For FY2011, PAT came in at `863cr (`682cr), growth of 26.5%.
· During the full year, the company filed 21ANDAs and 7 DMFs with 8 approvals received during the year.
4QFY2011 Consolidated Financial Performance:
| Y/E March (`cr) | 4QFY2011 | 3QFY2011 | % chg (qoq) | 4QFY2010 | % chg (yoy) | FY2011 | FY2010 | % chg (yoy) |
| Net sales | 1,512 | 1,467 | 3.0 | 1,286 | 17.5 | 5,707 | 4,774 | 19.5 |
| Other income | 45 | 46 | (2.4) | 54 | (15.9) | 134 | 111 | 20.4 |
| Total income | 1,557 | 1,514 | 2.9 | 1,340 | 16.2 | 5,841 | 4,885 | 19.6 |
| Gross profit | 897 | 897 | (0.1) | 798 | 12.4 | 3,469 | 2,804 | 23.7 |
| Gross margins | 59.3 | 61.2 | 62.0 | 60.8 | 58.7 | |||
| Operating profit | 268.7 | 254 | 5.7 | 250 | 7.4 | 1,066 | 887 | 20.2 |
| OPM (%) | 17.8 | 17.3 | 19.5 | 18.7 | 18.6 | |||
| Interest | 8 | 8 | 0.5 | 8 | 0.1 | 32 | 38 | (15.7) |
| Dep & amortisation | 46 | 41 | 12.0 | 41 | 13.5 | 171 | 124 | 38.1 |
| PBT | 260 | 252 | 3.3 | 256 | 1.7 | 996 | 836 | 19.2 |
| Provision for taxation | 31 | 24 | 31.4 | 29 | 6.5 | 117 | 136 | (14.0) |
| Reported net profit | 229 | 228 | 0.4 | 226 | 1.1 | 879 | 700 | 25.7 |
| Less : exceptional items | - | - | - | - | - | |||
| MI & share in associates | 2 | 4 | (58.2) | 4 | (64.2) | 17 | 18 | (6.7) |
| PAT after exceptional items | 227 | 224 | 1.4 | 221 | 3.0 | 863 | 682 | 26.5 |
| EPS (`) | 5.1 | 5.0 | 5.0 | 19.3 | 15.3 |
The stock is currently trading at 19.2 FY2012E and 14.0x FY2013E earnings. We currently have a Buy rating on the stock with a target price of `560. We shall revise our estimates post the management interaction.
Key financials:
| Y/E March (Rs.cr) | FY2009 | FY2010 | FY2011E | FY2012E | FY2013E |
| Net sales | 3,776 | 4,741 | 5,707 | 6,696 | 8,699 |
| % chg | 39.5 | 25.6 | 20.4 | 17.3 | 29.9 |
| Net profit | 502 | 681 | 863 | 976 | 1,339 |
| % chg | 22.8 | 35.9 | 26.6 | 13.1 | 37.2 |
| EPS (`) | 12.1 | 15.3 | 19.3 | 21.9 | 30.1 |
| EBITDA margin (%) | 17.2 | 18.0 | 18.7 | 18.3 | 18.3 |
| P/E (x) | 34.7 | 27.4 | 21.8 | 19.2 | 14.0 |
| RoE (%) | 37.1 | 36.7 | 31.8 | 29.6 | 32.0 |
| RoCE (%) | 20.8 | 23.3 | 24.2 | 22.6 | 24.0 |
| P/BV (x) | 12.2 | 8.2 | 6.4 | 5.1 | 4.0 |
| EV/sales (x) | 4.9 | 4.1 | 3.5 | 2.9 | 2.2 |
| EV/EBITDA (x) | 28.6 | 22.9 | 18.3 | 16.0 | 12.2 |
