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The company held its conference call on 25th Jan'16 and was addressed by key management
Key Highlights
As per the management, lot of restructuring exercise and product adjustments were undertaken in both Chronic and Acute businesses in India, which is paying off in terms of the growth in the current markets. Domestic formulation business have grown by more than 19% in current Dec'15 quarter to Rs 189 crore and about 13% for 9 months ended Dec'15, growth of 13% YoY.
All the products of the company be it in chronic or in acute have grown higher than the industry. The legendary brands of the company which contribute around 46% of total sales have grown faster than the markets.
The EO expense represents the bonus being allotted to the employees of the past year of around Rs 3 crore.
The increase in employee costs for Dec'15 quarter is largely attributable by the changes in bonus act, which led to higher provisions for bonus for entire 9 months ended Dec'15 in Dec'15 quarter only.
Around Rs 100 crore has already been spent in Goa expansion and on API side in Maharashtra State. Management expects to end the year FY'16 with a total capex of around Rs 150 crore. For FY'17 also capex of around Rs 100 crore is planned for 2nd phase of Goa and further expansions on API segment in Maharashtra. Majority of the capex will be met from internal accruals.
The US subsidiary continues to report healthy numbers, with sales up by 39% for 9 months ended Dec'15 and PAT at US $ 0.8 M. However, UK, Brazil and the African subsidiary continued to report losses. Management expects the losses to continue in FY'17 as well. Introduction of new products and increase in the capacities will result in better than expected results. Management is trying hard to make these subsidiaries profitable, particularly the UK subsidiary which should turnaround faster.
The company has received approvals for 3 products in US market out of which 1 product is already launched and balance apporvals will come in subsequent quarters. New products to be launched will drive further growth in US subsidiary
Overall the company expects good growth in Mar'16 quarter and is hopeful for a double digit growth in FY'17
As on Dec'15, there are about 15 pending ANDA's which were filed and the company is waiting for the regulatory approvals.
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