• Subdued Growth in Sales – Impacted by Supply chain constraints: The Sales grew by flat 1% YoY to Rs 636.88 crore, which includes other operating income Rs 4.7 crore (down by 18%) for the quarter ended March 2013. The growth in sales was impacted by the core pharmaceuticals business which was flat due to supply chain constraints at Nashik facility and other contract manufacturer sites during the quarter. The Growth was also impacted on account of supply constraints around vaccines. However, it expects the local supply situation to normalize by the end of Q2.

• Sharp fall in margins – EBIDTA down by 11%: The Company Operating Profit Margins fell by sharp 570 bps YoY to 26.3% on the back of sharp rise in consumption cost (720 bps YoY), Staff cost (90 bps YoY) and other expenses (70 bps YoY) as percentage to sales and net of stock adjustments. Eventually, OP fell by sharp 17% YoY to Rs 167.62 crore. But after the 3% growth in other income to Rs 76.96 crore, EBIDTA fall was curtailed to 11% YoY to Rs 244.58 crore.

• Lower EO losses & Tax rate – Boosted PAT growth: With no interest cost/income and after the marginal 1% increase in depreciation to Rs 4.17 crore, PBT before EO was down by 12% YoY to Rs 240.41 crore. However, after adjusting for lower EO losses (down by sharp 98% YoY to Rs 1.56 crore) coupled with lower effective tax rate (down by 210 bps YoY to 29.2%), PAT grew by 38% YoY to Rs 169.01 crore.

Standalone Yearly Performance:

Net sales grew by 11% YoY to Rs 2599.93 crore for the Year ended December 2012. However, OPM fell by 180 bps YoY to 31% and accordingly operating profit growth moderated to 5% YoY to Rs 819.14 crore. After the 21% growth in other income to Rs 193.48 crore, PBIDT grew by 7% YoY to Rs 1012.62 crore. With no interest income but after the 13% decline in depreciation to Rs 17.84 crore, PBT grew by 8% YoY to Rs 994.78 crore. After the marginal increase in effective tax rate by 40 bps YoY to 31.9% PAT grew by 7% YoY to Rs 677.19 crore. However, after adjusting for lower EO loss (net of tax) Rs 99.93 crore (down by 50% YoY) PAT after EO (net of tax) was up by 34% YoY to Rs 577.26 crore.

• The Scrip was up by 2.63% to Rs 2378.45 at BSE, India on 07^th May 2013 and currently trading at 30 times to the Q1'CY 13 EPS Rs 80.3.