|
Hikal consolidated net sales declined 5.65%
to Rs 502.35 crore in Q4FY22 compared to Q4FY21. Sales of Crop protection segment has gone
down 17.19% to Rs 194.41 crore (accounting for 38.70% of total sales). Sales of Pharmaceuticals segment has gone up
3.45% to Rs 307.94 crore (accounting for 61.30% of total sales).
Profit before interest, tax and other
unallocable items (PBIT) has slumped 58.02% to Rs 41.33 crore. PBIT of Crop protection segment fell 75.67%
to Rs 11.62 crore (accounting for 28.12% of total PBIT). PBIT of Pharmaceuticals segment fell 41.38%
to Rs 29.71 crore (accounting for 71.88% of total PBIT).
PBIT margin of Crop protection segment fell
from 20.34% to 5.98%. PBIT margin of
Pharmaceuticals segment fell from 17.02% to 9.65%. Overall PBIT margin fell from 18.49% to 8.23%.
Operating profit margin has declined from
20.52% to 12.14%, leading to 44.18% decline in operating profit to Rs 60.99
crore. Raw material cost as a % of total
sales (net of stock adjustments) increased from 51.99% to 54.88%. Employee cost increased from 8.03% to
10.76%. Other expenses rose from 19.22%
to 22.11%.
Other income fell 90.59% to Rs 0.27
crore. PBIDT fell 45.37% to Rs 61.26
crore. Provision for interest fell
18.96% to Rs 8.08 crore.
PBDT fell 47.94% to Rs 53.18 crore. Provision for depreciation rose 12.44% to Rs
24.23 crore.
Profit before tax down 64.09% to Rs 28.95
crore. Share of profit/loss were nil in
both the periods. Provision for tax was
expense of Rs 8.24 crore, compared to Rs 29.69 crore. Effective tax rate was 28.46% compared to
36.83%.
Minority interest was nil in both the
periods. Net profit attributable to
owners of the company decreased 59.33% to Rs 20.71 crore.
Equity capital stood at Rs 24.66 crore as of
31 March 2022 to Rs 24.66 crore as of 31 March 2021. Per share face Value remained same at Rs
2.00.
Promoters’ stake was 68.77% as of 31 March
2022 ,compared to 68.77% as of 31 March 2021.
Commenting
on the results, Jai Hiremath, Executive Chairman, Hikal Ltd. said,
“For the financial year ’22, we achieved a
PAT of Rs 161 Crores, which is a growth of 21% as compared to last financial
year. Our Board of Directors has recommended a final dividend of Rs 0.40 per
share (20% of FV). Along with an interim dividend of Rs. 1.20 per share (60% of
FV) declared in February 2022, the total dividend for FY22 stands at Rs 1.60
per share (80% of FV).
On 6th Jan 2022, an unfortunate incident
occurred at Sachin GIDC, Surat. Allegations were made that the tanker involved
was carrying a by-product which allegedly came from Hikal’s Taloja factory. All
relevant employees of Hikal have voluntarily co-operated in the ongoing
investigation. Since then, there has been a judicial recognition of the
non-existent role of Hikal and its employees in the entire incident, as
elucidated by the Hon’ble Gujarat High Court in its order. The matter is still
sub-judice and presently the Company is in a very strong legal position. As a
result of the Sachin GIDC incident the MPCB had given a closure notice to the
Taloja factory. We have provided all the documents to MPCB and are confident of
resolving the issue on the closure notice at the earliest.
The revenue for pharmaceutical business saw a
muted growth of 3% and stood at Rs. 307 Crores in Q4 FY22. It was in line with
the recent trend witnessed by the API industry due to strong transient
headwinds of softening demand and disruptions in global supply chains. This
combined with the challenging raw material disruptions and significant increase
in input costs has seen a pressure on our margins in Q4 which we expect to
continue through the first half of the year. On a positive side, we continued
to receive new inquiries from global innovator companies in the CDMO business
segment. We expect this segment to be a lead growth driver in the next few
years.
The Crop Protection business revenue stood at
Rs 194 Crores in Q4 FY22. We continued to face raw material availability
challenges for some of our key products. However, the demand remains strong in
the market. We will continue developing alternate domestic suppliers to
mitigate future supply chain disruptions. We are investing in new capacity
addition, which is expected to come on stream in second half of this financial
year. On the CDMO front, we continued receiving several new inquiries and are
working on a portfolio of new products for global innovator companies.
This year has marked the beginning of our
strategic transformation journey, ‘Pinnacle Program’. The program is seeing
good momentum along with positive changes across both businesses. Along with a
leading management consultant, we have developed a clear set of priorities for
the growth of our Company over next five years through a new strategic
direction. This will help reach our bold aspiration of driving profitable as
well as sustainable growth and transforming our business to go from ‘Good to
Great’.
As the industry faces strong headwinds due to
the inflationary pressures and a sharp rise in input costs of raw material,
energy and solvents, we expect growth to be tapered and margins to be contract
in the next year. We will continue to focus on passing through increased input
costs to our customers. However,we do expect longer lead times given the
inflationary pressures even customers are facing. To counteract the challenging
environment, we continue to undertake multiple cost reduction as well as operational
efficiency improvement initiatives within our business excellence program to
minimize the impact of rising cost on our margins.
We expect FY 2022-23 to be a challenging
year, one of consolidation and the following year we will return to sustainable
and profitable growth”.
Full
year results analysis
Net sales of Hikal have increased 12.92% to
Rs 1942.72 crore. Sales of Crop
protection segment has gone up 23.03% to Rs 812.98 crore (accounting for 41.85%
of total sales). Sales of
Pharmaceuticals segment has gone up 6.62% to Rs 1,129.74 crore (accounting for
58.15% of total sales).
Profit before interest, tax and other
unallocable items (PBIT) has slumped 2.56% to Rs 266.16 crore. PBIT of Crop protection segment rose 11.49%
to Rs 115.14 crore (accounting for 43.26% of total PBIT). PBIT of Pharmaceuticals segment fell 11.10%
to Rs 151.02 crore (accounting for 56.74% of total PBIT).
PBIT margin of Crop protection segment fell
from 15.63% to 14.16%. PBIT margin of
Pharmaceuticals segment fell from 16.03% to 13.37%. Overall PBIT margin fell from 15.88% to
13.70%.
Operating profit margin has declined from
18.77% to 17.53%, leading to 5.47% rise in operating profit to Rs 340.56
crore. Raw material cost as a % of total
sales (net of stock adjustments) decreased from 52.75% to 52.17%. Employee cost increased from 9.56% to
10.28%. Other expenses rose from 18.90%
to 20.34%.
Other income fell 1.81% to Rs 4.89
crore. PBIDT rose 5.36% to Rs 345.45
crore. Provision for interest fell
13.78% to Rs 31.21 crore. Loan funds
rose to Rs 675.02 crore as of 31 March 2022 from Rs 610.26 crore as of 31 March
2021. Inventories rose to Rs 328.98
crore as of 31 March 2022 from Rs 266.70 crore as of 31 March 2021. Sundry debtors were lower at Rs 437.72 crore
as of 31 March 2022 compared to Rs 485.53 crore as of 31 March 2021. Cash and bank balance rose to Rs 49.09 crore
as of 31 March 2022 from Rs 36.81 crore as of 31 March 2021. Investments rose to Rs 10.91 crore as of 31
March 2022 from Rs 0.61 crore as of 31 March 2021 .
PBDT rose 7.74% to Rs 314.24 crore. Provision for depreciation rose 12.24% to Rs
95.67 crore. Fixed assets increased to
Rs 1,163.97 crore as of 31 March 2022 from Rs 956.54 crore as of 31 March
2021. Intangible assets increased from
Rs 10.25 crore to Rs 10.29 crore.
Profit before tax grew 5.88% to Rs 218.57
crore. Share of profit/loss were nil in
both the periods. Provision for tax was
expense of Rs 58.06 crore, compared to Rs 73.28 crore. Effective tax rate was 26.56% compared to
35.50%.
Minority interest was nil in both the
periods. Net profit attributable to
owners of the company increased 20.55% to Rs 160.51 crore.
Equity capital stood at Rs 24.66 crore as of
31 March 2022 to Rs 24.66 crore as of 31 March 2021. Per share face Value remained same at Rs
2.00.
Promoters’ stake was 68.77% as of 31 March
2022 compared to 68.77% as of 31 March 2021 .
The scrip is
currently trading at Rs 353
|
Hikal : Consolidated Results
|
|
Particulars
|
2203
(03)
|
2103
(03)
|
Var.(%)
|
2203
(12)
|
2103
(12)
|
Var.(%)
|
|
Net Sales
|
502.35
|
532.46
|
-6
|
1,942.72
|
1,720.44
|
13
|
|
OPM (%)
|
12.1
|
20.6
|
|
17.5
|
18.8
|
|
|
OP
|
60.99
|
109.6
|
-44
|
340.56
|
322.89
|
5
|
|
Other Inc.
|
0.27
|
2.87
|
-91
|
4.89
|
4.98
|
-2
|
|
PBIDT
|
61.26
|
112.47
|
-46
|
345.45
|
327.87
|
5
|
|
Interest
|
8.08
|
7.18
|
13
|
31.21
|
36.2
|
-14
|
|
PBDT
|
53.18
|
105.29
|
-49
|
314.24
|
291.67
|
8
|
|
Depreciation
|
24.23
|
24.68
|
-2
|
95.67
|
85.24
|
12
|
|
PBT
|
28.95
|
80.61
|
-64
|
218.57
|
206.43
|
6
|
|
EO Income
|
0
|
0
|
|
0
|
0
|
|
|
PBT after EO
|
28.95
|
80.61
|
-64
|
218.57
|
206.43
|
6
|
|
Taxation
|
8.24
|
29.69
|
-72
|
58.06
|
73.28
|
-21
|
|
PAT
|
20.71
|
50.92
|
-59
|
160.51
|
133.15
|
21
|
|
EPS (Rs)*
|
#
|
#
|
|
13.0
|
10.8
|
|
|
Notes
|
|
* EPS is on current equity of Rs 24.66 crore, Face value of Rs
2, Excluding extraordinary items.
|
|
# EPS is not annualised
|
|
bps : Basis points
|
|
Figures in Rs crore
|
|
Source: Capitaline Corporate Database
|
|
Hikal : Consolidated Segment Results
|
|
|
% of (Total)
|
2203
(03)
|
2103
(03)
|
Var.(%)
|
% of (Total)
|
2203
(12)
|
2103
(12)
|
Var.(%)
|
|
Sales
|
|
Crop protection
|
39
|
194.41
|
234.78
|
-17
|
42
|
812.98
|
660.8
|
23
|
|
Pharmaceuticals
|
61
|
307.94
|
297.68
|
3
|
58
|
1,129.74
|
1,059.64
|
7
|
|
Total Reported Sales
|
100
|
502.35
|
532.46
|
-6
|
100
|
1,942.72
|
1,720.44
|
13
|
|
Less: Inter segment revenues
|
|
0
|
0
|
-
|
|
0
|
0
|
-
|
|
Net Sales
|
|
502.35
|
532.46
|
-6
|
|
1,942.72
|
1,720.44
|
13
|
|
PBIT
|
|
Crop protection
|
28
|
11.62
|
47.76
|
-76
|
43
|
115.14
|
103.27
|
11
|
|
Pharmaceuticals
|
72
|
29.71
|
50.68
|
-41
|
57
|
151.02
|
169.88
|
-11
|
|
Total PBIT
|
100
|
41.33
|
98.44
|
-58
|
100
|
266.16
|
273.15
|
-3
|
|
Less : Interest
|
|
8.08
|
9.97
|
-19
|
|
31.21
|
36.2
|
-14
|
|
Add: Other un-allocable
|
|
-4.3
|
-7.86
|
45
|
|
-16.38
|
-30.52
|
46
|
|
PBT
|
|
28.95
|
80.61
|
-64
|
|
218.57
|
206.43
|
6
|
|