Alembic Pharmaceuticals reports 173% CAPEX growth and 10.4% Revenue growth
27-04-2015 • About Alembic Pharmaceuticals (
$APLLTD) • By InTwits
Alembic Pharmaceuticals reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Alembic Pharmaceuticals has medium CAPEX intensity: 5 year average CAPEX/Revenue was 6.1%. At the same time it's in pair with industry average of 7.2%.
- CAPEX is quite volatile: 2,236 in FY2015, 820 in FY2014, 860 in FY2013, 613 in FY2012, 625 in FY2011
- The company has highly profitable business model: ROIC is at 35.7%
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Alembic Pharmaceuticals ($APLLTD) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 12,013 | 14,654 | 15,203 | 18,632 | 20,561 | 10.4% |
| EBITDA | 1,604 | 2,260 | 2,490 | 3,577 | 4,030 | 12.6% |
| Net Income | 854 | 1,301 | 1,653 | 2,355 | 2,829 | 20.1% |
Balance Sheet
|
|---|
| Cash | 63 | 238 | 155 | 228 | 234 | 2.8% |
| Short Term Debt | 1,746 | 2,579 | 1,163 | 572 | 2,447 | 328.0% |
| Long Term Debt | 1,533 | 949 | 705 | 522 | 188 | -64.0% |
Cash flow
|
|---|
| Capex | 625 | 613 | 860 | 820 | 2,236 | 172.8% |
Ratios
|
|---|
| Revenue growth | -52.0% | 22.0% | 3.7% | 22.6% | 10.4% | |
| EBITDA growth | | 40.9% | 10.2% | 43.7% | 12.6% | |
| EBITDA Margin | 13.4% | 15.4% | 16.4% | 19.2% | 19.6% | 0.4% |
| Net Income Margin | 7.1% | 8.9% | 10.9% | 12.6% | 13.8% | 1.1% |
| CAPEX, % of revenue | 5.2% | 4.2% | 5.7% | 4.4% | 10.9% | 6.5% |
| ROIC | | 27.5% | 29.1% | 41.5% | 35.7% | -5.8% |
| ROE | | 37.6% | 36.8% | 40.0% | 36.3% | -3.7% |
| Net Debt/EBITDA | 2.0x | 1.5x | 0.7x | 0.2x | 0.6x | 0.4x |
Revenue and profitability
The company's Revenue jumped on 10.4% in FY2015. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased slightly on 1.5 pp from 6.8% to 8.3% in FY2015.
Net Income marign increased slightly on 1.1 pp from 12.6% to 13.8% in FY2015.
Capital expenditures (CAPEX) and working capital investments
In FY2015 Alembic Pharmaceuticals had CAPEX/Revenue of 10.9%. Alembic Pharmaceuticals showed CAPEX/Revenue growth of 6.7 pp from 4.2% in FY2012 to 10.9% in FY2015. Average CAPEX/Revenue for the last three years was 7.0%.To secure this fast growth the company invested a large share of EBITDA (55.5%) to CAPEX.
Return on investment
The company operates at high and attractive ROIC (35.70%) and ROE (36.27%). ROIC decreased on 5.8 pp from 41.5% to 35.7% in FY2015. ROE decreased on 3.7 pp from 40.0% to 36.3% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.6x and Debt / EBITDA is 0.7x. Net Debt / EBITDA surged on 0.4x from 0.2x to 0.6x in FY2015. Debt surged on 141% in FY2015 while cash increased on 2.8% in FY2015.
Valuation
Alembic Pharmaceuticals's trades at EV/EBITDA 22.6x and P/E 31.3x while industy averages are 10.5x and 26.1x. The company's EV/(EBITDA-CAPEX) is 50.7x with the industry average at 4.7x.
Management team
Alembic Pharmaceuticals's CEO Chirayu Ramanbhai Amin has spent 7 years at the company.
Appendix 1: Peers in Pharmaceuticals
Below we provide Alembic Pharmaceuticals benchmarking against other companies in Pharmaceuticals industry for the last 5 years. We show data for the top-5 companies by key financial metric together with the median value for all the companies in the industry.
Top companies by Revenue growth, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Granules India ($GRANULES) | | 37.6% | 16.9% | 43.4% | 18.1% |
| Marksans Pharma ($MARKSANS) | -66.6% | 16.7% | 23.3% | 43.3% | |
| Sun Pharmaceutical Industries ($SUNPHARMA) | -87.8% | 39.9% | 40.4% | 42.4% | |
| Torrent Pharmaceuticals ($TORNTPHARM) | -63.5% | 22.7% | 17.7% | 32.2% | |
| Abbott India ($ABBOTINDIA) | -46.4% | 8.2% | 8.7% | 27.3% | |
| |
|---|
| Median (41 companies) | -45.7% | 16.6% | 14.9% | 12.6% | 0.3% |
|---|
| Alembic Pharmaceuticals ($APLLTD) | | 22.0% | 3.7% | 22.6% | 10.4% |
Top companies by Gross margin, %
| Top | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Dr.Reddy'S Laboratories ($DRREDDY) | | | 52.1% | 57.4% | |
| Omega Laboratories ($OMEGALAB) | | 0.0% | 0.0% | 0.0% | 0.0% |
| |
|---|
| Median (2 companies) | | 46.9% | 26.1% | 28.7% | 0.0% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sun Pharmaceutical Industries ($SUNPHARMA) | 34.3% | 40.8% | 44.3% | 44.9% | |
| Divi'S Laboratories ($DIVISLAB) | 38.1% | 37.2% | 38.2% | 40.2% | |
| Venus Remedies ($VENUSREM) | 24.9% | 25.2% | 25.6% | 25.5% | |
| Dr.Reddy'S Laboratories ($DRREDDY) | 21.7% | 25.8% | 22.9% | 25.1% | |
| Natco Pharma ($NATCOPHARM) | 21.3% | 21.5% | 23.2% | 24.9% | |
| |
|---|
| Median (36 companies) | 16.5% | 12.7% | 12.8% | 14.3% | 16.2% |
|---|
| Alembic Pharmaceuticals ($APLLTD) | 13.4% | 15.4% | 16.4% | 19.2% | 19.6% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Granules India ($GRANULES) | 5.3% | 8.8% | 15.2% | 24.3% | 11.4% |
| Dishman Pharmaceuticals & Chemicals ($DISHMAN) | 24.3% | 8.4% | 10.9% | 21.6% | |
| Venus Remedies ($VENUSREM) | 26.6% | 23.2% | 22.2% | 17.5% | |
| Shasun Pharmaceuticals ($SHASUNPHAR) | 4.3% | 10.4% | 15.2% | 15.8% | |
| Natco Pharma ($NATCOPHARM) | 20.0% | 24.4% | 16.3% | 14.4% | |
| |
|---|
| Median (28 companies) | 7.4% | 8.2% | 8.3% | 5.8% | 11.4% |
|---|
| Alembic Pharmaceuticals ($APLLTD) | 5.2% | 4.2% | 5.7% | 4.4% | 10.9% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Sun Pharmaceutical Industries ($SUNPHARMA) | 18.9% | 24.8% | 31.1% | 35.0% | |
| Marksans Pharma ($MARKSANS) | -25.8% | -142.4% | 34.9% | 33.8% | |
| Torrent Pharmaceuticals ($TORNTPHARM) | 22.3% | 26.4% | 30.5% | 33.2% | |
| Jenburkt Pharmaceuticals ($JENBURPH) | 43.6% | 34.1% | 29.0% | 32.4% | |
| Divi'S Laboratories ($DIVISLAB) | 25.6% | 30.6% | 30.4% | 32.3% | |
| |
|---|
| Median (63 companies) | 13.5% | 13.7% | 13.2% | 14.4% | 8.7% |
|---|
| Alembic Pharmaceuticals ($APLLTD) | | 27.5% | 29.1% | 41.5% | 35.7% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Ind-Swift Laboratories ($INDSWFTLAB) | 4.6x | 5.5x | 16.1x | 19.5x | |
| Shasun Pharmaceuticals ($SHASUNPHAR) | 4.5x | 2.8x | 4.5x | 6.0x | |
| Sharon Bio-Medicine ($SHARONBIO) | 4.6x | 4.7x | 5.3x | 4.5x | |
| Jubilant Life Sciences Limited ($JUBILANT) | 5.3x | 4.0x | 3.5x | 3.5x | |
| Kopran ($KOPRAN) | 6.0x | 4.5x | 3.0x | 3.0x | |
| |
|---|
| Median (50 companies) | 1.5x | 1.5x | 1.4x | 0.5x | 2.1x |
|---|
| Alembic Pharmaceuticals ($APLLTD) | 2.0x | 1.5x | 0.7x | 0.2x | 0.6x |
