Unichem Laboratories CAPEX jumped on 80.3% and Revenue jumped on 11.0%
20-05-2016 • About Unichem Laboratories (
$UNICHEMLAB) • By InTwits
Unichem Laboratories reported FY2016 financial results today. Here are the key drivers of the company's long term financial model:
- Unichem Laboratories is a growth stock: FY2016 revenue growth was 11.0%, 5 year revenue CAGR was 10.1% at FY2016 ROIC 12.8%
- Unichem Laboratories has medium CAPEX intensity: 5 year average CAPEX/Revenue was 9.7%. At the same time it's a lot of higher than industry average of 7.5%.
- CAPEX is quite volatile: ₹696m in FY2016, ₹945m in FY2015, ₹1,095m in FY2014, ₹1,368m in FY2013, ₹1,865m in FY2012
- The company has highly profitable business model: ROIC is 12.8%
Below you can find a comprehensive analysis of the key data driving the company's performance and the stock price.
Revenue and profitability
The company's Revenue jumped on 11.0%. Having declining revenue the company managed to increase EBITDA margin. EBITDA Margin increased on 2.7 pp from 9.8% to 12.4% in FY2016.
Net Income margin increased slightly on 1.8 pp from 6.3% to 8.1% in FY2016.
Investments (CAPEX, working capital and M&A)
The company's CAPEX/Revenue was 10.6% in FY2016. The company's CAPEX/Revenue increased slightly on 1.6 pp from 9.1% in FY2013 to 10.6% in FY2016. For the last three years the average CAPEX/Revenue was 8.8%. To secure its fast growth Unichem Laboratories invested a large share of EBITDA (86.5%) to CAPEX.
Return on investment
The company operates at good ROIC (12.8%) while ROE is low (11.9%). ROIC increased on 6.2 pp from 6.7% to 12.8% in FY2016. ROE increased on 2.9 pp from 9.0% to 11.9% in FY2016.
Leverage (Debt)
Company's Net Debt / EBITDA is 0.1x and Debt / EBITDA is 0.2x. Net Debt / EBITDA increased on 0.021x from 0.1x to 0.1x in FY2016. Debt surged on 63.7% while cash surged on 36.9%. During the last 5 years Net Debt/EBITDA bottomed in FY2014 at 0.1x and was growing since that time.
Unichem Laboratories has no short term refinancing risk: cash is higher than short term debt (129.8%).
Valuation and dividends
Unichem Laboratories's trades at EV/EBITDA 14.6x and P/E 22.0x while industy averages are 17.8x and 21.9x. The company's EV/(EBITDA-CAPEX) is 108.7x with the industry average at 22.8x.
Financial and operational results
Unichem Laboratories ($UNICHEMLAB) key annual financial indicators| mln. INR | 2012 | 2013 | 2014 | 2015 | 2016 | 2016/2015 |
|---|
P&L
|
|---|
| Revenue | 8,755 | 10,808 | 11,334 | 12,018 | 13,346 | 11.0% |
| EBITDA | 1,183 | 1,744 | 1,779 | 1,015 | 1,640 | 61.6% |
| Net Income | 713 | 1,132 | 1,693 | 754 | 1,080 | 43.3% |
Balance Sheet
|
|---|
| Cash | 153 | 121 | 138 | 123 | 168 | 36.9% |
| Short Term Debt | 254 | 62 | 10 | 16 | 129 | 695.0% |
| Long Term Debt | 440 | 209 | 246 | 203 | 230 | 13.2% |
Cash flow
|
|---|
| Capex | 1,131 | 980 | 1,040 | 787 | 1,419 | 80.3% |
Ratios
|
|---|
| Revenue growth | 6.2% | 23.5% | 4.9% | 6.0% | 11.0% | |
| EBITDA growth | -21.1% | 47.3% | 2.0% | -43.0% | 61.6% | |
|
|---|
| EBITDA Margin | 13.5% | 16.1% | 15.7% | 8.4% | 12.3% | 3.8% |
| Net Income Margin | 8.1% | 10.5% | 14.9% | 6.3% | 8.1% | 1.8% |
| CAPEX, % of revenue | 12.9% | 9.1% | 9.2% | 6.5% | 10.6% | 4.1% |
|
|---|
| ROIC | 11.8% | 17.3% | 15.7% | 6.7% | 12.8% | 6.2% |
| ROE | 11.1% | 16.3% | 21.9% | 9.0% | 11.9% | 2.9% |
| Net Debt/EBITDA | 0.5x | 0.1x | 0.1x | 0.1x | 0.1x | 0.0x |
Peers in Pharmaceuticals
Below you can find Unichem Laboratories benchmarking vs. other companies in Pharmaceuticals industry. It's shown for the period of 5 years for the key financial metrics. Each table has median value for all the companies in the industry together with individual financial data of the top-5 companies in the industry by particular financial metric.
Top companies by Revenue growth, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Mangalam Drugs & Organics ($MANGALAM) | - | -18.2% | -2.1% | 79.8% | 33.7% |
| Sun Pharmaceutical Industries ($SUNPHARMA) | 39.9% | 40.4% | 42.4% | 70.2% | - |
| Lyka Labs ($LYKALABS) | 41.9% | -25.7% | -22.6% | 68.7% | - |
| Marksans Pharma ($MARKSANS) | 16.7% | 23.3% | 43.3% | 26.8% | - |
| Torrent Cables ($TORRCABS) | 27.5% | 17.4% | -42.9% | 26.5% | - |
| |
|---|
| Median (41 companies) | 22.7% | 14.7% | 13.7% | 9.2% | 14.2% |
|---|
| Unichem Laboratories ($UNICHEMLAB) | - | 23.5% | 4.9% | 6.0% | 11.0% |
Top companies by Gross margin, %
| Top | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Dr.Reddy'S Laboratories ($DRREDDY) | - | 52.1% | 57.4% | 57.6% | 59.6% |
| Omega Laboratories ($OMEGALAB) | 0.0% | 0.0% | 0.0% | 0.0% | 0.0% |
| |
|---|
| Median (2 companies) | 46.9% | 26.1% | 28.7% | 28.8% | 29.8% |
|---|
Top companies by EBITDA margin, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Divi'S Laboratories ($DIVISLAB) | 37.2% | 38.2% | 40.2% | 37.4% | - |
| Hester Biosciences ($HESTERBIO) | - | - | - | 32.9% | - |
| Sun Pharmaceutical Industries ($SUNPHARMA) | 40.8% | 44.3% | 44.9% | 29.2% | - |
| Natco Pharma ($NATCOPHARM) | 21.5% | 23.2% | 24.9% | 26.2% | - |
| Dr.Reddy'S Laboratories ($DRREDDY) | 25.8% | 22.9% | 25.1% | 23.2% | 25.8% |
| |
|---|
| Median (53 companies) | 12.7% | 12.8% | 14.3% | 12.1% | 18.8% |
|---|
| Unichem Laboratories ($UNICHEMLAB) | 13.5% | 16.1% | 15.7% | 8.4% | 12.3% |
Top companies by CAPEX/Revenue, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Claris Lifesciences ($CLARIS) | 58.1% | 42.9% | - | 103.1% | 15.8% |
| Wintac ($WINTAC) | - | - | - | 22.8% | - |
| Hester Biosciences ($HESTERBIO) | - | - | - | 21.5% | - |
| Ipca Laboratories ($IPCALAB) | 11.2% | 8.3% | 11.6% | 17.8% | - |
| Natco Pharma ($NATCOPHARM) | 24.4% | 16.3% | 14.4% | 14.1% | - |
| |
|---|
| Median (31 companies) | 7.7% | 7.5% | 5.7% | 6.0% | 9.4% |
|---|
| Unichem Laboratories ($UNICHEMLAB) | 12.9% | 9.1% | 9.2% | 6.5% | 10.6% |
Top companies by ROIC, %
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Marksans Pharma ($MARKSANS) | -142.4% | 34.9% | 33.8% | 41.2% | - |
| Alembic Pharmaceuticals ($APLLTD) | 27.5% | 29.1% | 41.5% | 35.7% | 62.1% |
| Jenburkt Pharmaceuticals ($JENBURPH) | 34.1% | 29.0% | 32.4% | 35.3% | - |
| Abbott India ($ABBOTINDIA) | 29.6% | 26.9% | 30.5% | 34.2% | - |
| Divi'S Laboratories ($DIVISLAB) | 30.6% | 30.4% | 32.3% | 30.5% | - |
| |
|---|
| Median (63 companies) | 14.0% | 13.2% | 14.4% | 13.3% | 15.5% |
|---|
| Unichem Laboratories ($UNICHEMLAB) | 11.8% | 17.3% | 15.7% | 6.7% | 12.8% |
Top companies by Net Debt / EBITDA
| Top 5 | FY2012 | FY2013 | FY2014 | FY2015 | FY2016 |
|---|
| Jubilant Life Sciences Limited ($JUBILANT) | 4.0x | 3.5x | 3.5x | 6.4x | - |
| Shasun Pharmaceuticals ($SHASUNPHAR) | 2.8x | 4.5x | 6.0x | 6.2x | - |
| Claris Lifesciences ($CLARIS) | 1.9x | 1.1x | 1.8x | 3.2x | 2.9x |
| Dishman Pharmaceuticals & Chemicals ($DISHMAN) | 3.6x | 2.6x | 2.3x | 2.9x | 2.1x |
| Neuland Laboratories ($NEULANDLAB) | 4.2x | 3.5x | 2.6x | 2.6x | 2.0x |
| |
|---|
| Median (48 companies) | 1.6x | 1.4x | 0.5x | 0.1x | 0.9x |
|---|
| Unichem Laboratories ($UNICHEMLAB) | 0.5x | 0.1x | 0.1x | 0.1x | 0.1x |
