Rpg Life Sciences Net Income dropped on 98.1% in 2015 and EBITDA Margin increased slightly on 0.88 pp from 5.0% to 5.8%
29-04-2015 • About Rpg Life Sciences (
$RPGLIFE) • By InTwits
Rpg Life Sciences reported FY2015 financial results today. Overall the company's long term financial model is characterised by the following facts:
- Rpg Life Sciences doesn't have a profitable business model yet: FY2015 ROIC is 1.8%
- EBITDA Margin is quite volatile: 5.8% in FY2015, 5.0% in FY2014, 7.3% in FY2013, 9.6% in FY2012, 17.6% in FY2011
- Rpg Life Sciences has medium CAPEX intensity: 5 year average CAPEX/Revenue was 5.3%. At the same time it's in pair with industry average of 7.1%.
- CAPEX is quite volatile: 80.7 in FY2015, 59.2 in FY2014, 76.1 in FY2013, 30.2 in FY2012, 12.2 in FY2011
- The company has potentially unprofitable business model: ROIC is at 1.8%
- It operates with high leverage: Net Debt/EBITDA is 2.3x while industry average is 1.3x
Below you can find a comprehensive analysis of the key data driving the company's performance and stock price.
Rpg Life Sciences ($RPGLIFE) key annual financial indicators
| mln. INR | 2011 | 2012 | 2013 | 2014 | 2015 | 2015/2014 |
|---|
P&L
|
|---|
| Revenue | 1,868 | 1,928 | 2,216 | 2,356 | 2,423 | 2.9% |
| EBITDA | 328 | 185 | 161 | 117 | 142 | 21.0% |
| Net Income | 127 | 9 | 44 | 534 | 10 | -98.1% |
Balance Sheet
|
|---|
| Cash | 2 | 2 | 2 | 3 | 3 | -13.8% |
| Short Term Debt | 281 | 321 | 476 | 140 | 327 | 133.3% |
| Long Term Debt | 248 | 207 | 105 | 4 | 3 | -11.1% |
Cash flow
|
|---|
| Capex | 113 | 87 | 126 | 137 | 107 | -21.4% |
Ratios
|
|---|
| Revenue growth | -31.7% | 3.2% | 14.9% | 6.3% | 2.9% | |
| EBITDA growth | 3.1% | -43.6% | -12.9% | -27.3% | 21.0% | |
| EBITDA Margin | 17.6% | 9.6% | 7.3% | 5.0% | 5.8% | 0.9% |
| Net Income Margin | 6.8% | 0.4% | 2.0% | 22.7% | 0.4% | -22.3% |
| CAPEX, % of revenue | 6.0% | 4.5% | 5.7% | 5.8% | 4.4% | -1.4% |
| ROIC | 18.3% | 6.1% | 4.5% | 0.8% | 1.8% | 1.0% |
| ROE | 18.3% | 1.1% | 5.9% | 52.9% | 0.8% | -52.1% |
| Net Debt/EBITDA | 1.6x | 2.8x | 3.6x | 1.2x | 2.3x | 1.1x |
Revenue and profitability
The company's Revenue increased on 2.9% in FY2015. Revenue decline was accompanies by EBITDA margin decline. EBITDA Margin decreased slightly on 1.00 pp from 12.3% to 11.3% in FY2015.
Net Income marign dropped on 22.3 pp from 22.7% to 0.41% in FY2015.
Capital expenditures (CAPEX) and working capital investments
The company's CAPEX/Revenue was 4.4% in FY2015. Rpg Life Sciences's CAPEX/Revenue showed almost no change from FY2012 to FY2015. It's average CAPEX/Revenue for the last three years was 5.3%.The company maintained rich investment policy and has spent a big chunk of EBITDA (75.7%) to CAPEX.
Return on investment
The company operates at low ROIC (1.79%) and ROE (0.80%). ROIC increased slightly on 1.0 pp from 0.75% to 1.8% in FY2015. ROE dropped on 52.1 pp from 52.9% to 0.80% in FY2015.
Leverage (Debt)
Company's Net Debt / EBITDA is 2.3x and Debt / EBITDA is 2.3x. Net Debt / EBITDA jumped on 1.1x from 1.2x to 2.3x in FY2015. Debt jumped on 130% in FY2015 while cash dropped on 13.8% in FY2015.
Valuation
Rpg Life Sciences's trades at EV/EBITDA 18.1x and P/E 224.2x while industy averages are 10.5x and 26.1x. The company's EV/(EBITDA-CAPEX) is 74.7x with the industry average at 4.7x.
Appendix 1: Peers in Pharmaceuticals
Below we provide Rpg Life Sciences 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 ($ABBOTINDIA) | -46.4% | 8.2% | 8.7% | 27.3% | |
| |
|---|
| Median (41 companies) | -46.4% | 16.7% | 14.7% | 13.7% | 10.4% |
|---|
| Rpg Life Sciences ($RPGLIFE) | | 3.2% | 14.9% | 6.3% | 2.9% |
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 ($NATCOPHARM) | 21.3% | 21.5% | 23.2% | 24.9% | |
| |
|---|
| Median (36 companies) | 16.2% | 12.9% | 13.4% | 15.0% | 17.9% |
|---|
| Rpg Life Sciences ($RPGLIFE) | 17.6% | 9.6% | 7.3% | 5.0% | 5.8% |
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 ($NATCOPHARM) | 20.0% | 24.4% | 16.3% | 14.4% | |
| |
|---|
| Median (28 companies) | 7.4% | 8.2% | 8.3% | 5.7% | 11.2% |
|---|
| Rpg Life Sciences ($RPGLIFE) | 6.0% | 4.5% | 5.7% | 5.8% | 4.4% |
Top companies by ROIC, %
| Top 5 | FY2011 | FY2012 | FY2013 | FY2014 | FY2015 |
|---|
| Alembic Pharmaceuticals ($APLLTD) | | 27.5% | 29.1% | 41.5% | 35.7% |
| Sun Pharmaceutical Industries ($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 ($JENBURPH) | 43.6% | 34.1% | 29.0% | 32.4% | |
| |
|---|
| Median (63 companies) | 13.5% | 14.0% | 13.8% | 15.6% | 17.4% |
|---|
| Rpg Life Sciences ($RPGLIFE) | 18.3% | 6.1% | 4.5% | 0.8% | 1.8% |
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 ($KOPRAN) | 6.0x | 4.5x | 3.0x | 3.0x | |
| |
|---|
| Median (50 companies) | 1.6x | 1.4x | 1.2x | 0.3x | 1.3x |
|---|
| Rpg Life Sciences ($RPGLIFE) | 1.6x | 2.8x | 3.6x | 1.2x | 2.3x |
