Capitaline

Results 25-Apr-24

Analysis

Laurus Labs

OP down 15.43% and NP down 26.58%

For the quarter ending March 2024, consolidated Net sales (including other operating income) of Laurus Labs has increased 4.26% to Rs 1439.67 crore compared to quarter ended March 2023. Operating profit margin has declined from 20.68% to 16.77%, leading to 15.43% decline in operating profit to Rs 241.49 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 40.81% to 43.81%. Purchase of finished goods cost rose from 0.42% to 3.02%. Employee cost increased from 11.50% to 11.94%. Other expenses rose from 22.82% to 23.34%.

Other income rose 983.63% to Rs 18.53 crore. PBIDT fell 9.48% to Rs 260.02 crore. Provision for interest fell 4.90% to Rs 50.5 crore. Loan funds rose to Rs 2,577.40 crore as of 31 March 2024 from Rs 2,015.09 crore as of 31 March 2023. Inventories rose to Rs 1,845.41 crore as of 31 March 2024 from Rs 1,684.81 crore as of 31 March 2023. Sundry debtors were higher at Rs 1,662.92 crore as of 31 March 2024 compared to Rs 1,580.44 crore as of 31 March 2023. Cash and bank balance rose to Rs 141.65 crore as of 31 March 2024 from Rs 48.46 crore as of 31 March 2023. Investments rose to Rs 123.98 crore as of 31 March 2024 from Rs 49.90 crore as of 31 March 2023 .

PBDT fell 10.52% to Rs 209.52 crore. Provision for depreciation rose 17.52% to Rs 102.25 crore. Fixed assets increased to Rs 4,066.55 crore as of 31 March 2024 from Rs 3,713.10 crore as of 31 March 2023. Intangible assets stood at Rs 246.30 crore.

Profit before tax down 27.10% to Rs 107.27 crore. Share of profit/loss was 84.77% higher at Rs -0.3 crore. Provision for tax was expense of Rs 31.95 crore, compared to Rs 39.9 crore. Effective tax rate was 29.87% compared to 27.49%.

Net profit attributable to owners of the company decreased 26.58% to Rs 75.61 crore.

Equity capital increased from Rs 107.73 crore as of 31 March 2023 to Rs 107.79 crore as of 31 March 2024. Per share face Value remained same at Rs 2.00.

Promoters’ stake was 27.19% as of 31 March 2024 ,compared to 27.20% as of 31 March 2023 .

Full year results analysis.

Net sales (including other operating income) of Laurus Labs has declined 16.55% to Rs 5040.83 crore. Operating profit margin has declined from 26.36% to 15.42%, leading to 51.17% decline in operating profit to Rs 777.50 crore. Raw material cost as a % of total sales (net of stock adjustments) increased from 43.14% to 47.11%. Purchase of finished goods cost fell from 2.59% to 2.16%. Employee cost increased from 9.65% to 12.45%. Other expenses rose from 18.17% to 23.16%.

Other income rose 339% to Rs 26.34 crore. PBIDT fell 49.70% to Rs 803.84 crore. Provision for interest rose 10.73% to Rs 182.9 crore. Loan funds rose to Rs 2,577.40 crore as of 31 March 2024 from Rs 2,015.09 crore as of 31 March 2023. Inventories rose to Rs 1,845.41 crore as of 31 March 2024 from Rs 1,684.81 crore as of 31 March 2023. Sundry debtors were higher at Rs 1,662.92 crore as of 31 March 2024 compared to Rs 1,580.44 crore as of 31 March 2023. Cash and bank balance rose to Rs 141.65 crore as of 31 March 2024 from Rs 48.46 crore as of 31 March 2023. Investments rose to Rs 123.98 crore as of 31 March 2024 from Rs 49.90 crore as of 31 March 2023 .

PBDT fell 56.67% to Rs 620.94 crore. Provision for depreciation rose 18.67% to Rs 384.58 crore. Fixed assets increased to Rs 4,066.55 crore as of 31 March 2024 from Rs 3,713.10 crore as of 31 March 2023. Intangible assets stood at Rs 246.30 crore.

Profit before tax down 78.69% to Rs 236.36 crore. Share of profit/loss was 85.05% lower at Rs -5.94 crore. Provision for tax was expense of Rs 68.15 crore, compared to Rs 312.3 crore. Effective tax rate was 29.58% compared to 28.24%.

Minority interest decreased 48.19% to Rs 1.72 crore. Net profit attributable to owners of the company decreased 79.68% to Rs 160.55 crore.

Equity capital increased from Rs 107.73 crore as of 31 March 2023 to Rs 107.79 crore as of 31 March 2024. Per share face Value remained same at Rs 2.00.

Promoters’ stake was 27.19% as of 31 March 2024 ,compared to 27.20% as of 31 March 2023 .

Cash flow from operating activities decreased to Rs 665.69 crore for year ended March 2024 from Rs 993.90 crore for year ended March 2023. Cash flow used in acquiring fixed assets during the year ended March 2024 stood at Rs 678.31 crore, compared to Rs 990.16 crore during the year ended March 2023.

Business Highlights

Board of Directors of the Company in their meeting held on April 25, 2024 have approved for the payment of second interim dividend of Rs 0.40 (20%) per equity share of Rs 2 each, for the Financial Year 2023-24. the Company has fixed “May 08, 2024” as “Record Date” for determining the eligibility of the Shareholders. The Dividend amount will be paid on or after May 17, 2024.

FDF business generated revenue of Rs 1414 crore during FY24, up by 24% due to higher offtake in ARV business and growth in Developed markets portfolio. In Q4 FY24, FDF business increased 9% YoY.

API business reported revenue of Rs 2545 Crore during FY24, decreased by 2% YoY. In Q4 FY24, API revenue increased 4% YoY to Rs 745 crore supported from growth across franchise despite continuing pricing pressure in Other APIs segment.

CDMO-Synthesis business reported revenues of Rs 922 crore during FY24, decreased by 57% YoY, led by completion of large supply contract execution last year. In Q4 FY24, CDMO-synthesis revenue increased by 4% YoY to Rs 236 crore.

Laurus Bio division reported revenues of Rs 160 crore during FY24, up by 28%. Q4 FY24 revenue decreased by 37% YoY to Rs 29 crore, mainly due to customer order cyclicality.

The Company is growing and expanding into newer business areas such as CDMO business including Animal Health, Crop Sciences; Biotechnology; Cell and Gene therapy.

In FY24, FDF contributed 28% of total revenue, CDMO 18%, API 51% and Bio 3%.

Management Comments :
Founder and Chief Executive Officer Dr. Satyanarayana Chava stated “Laurus core results reflects continued resilience across our business divisions despite discontinuation of Covid related products purchase orders. We delivered underlying revenue growth of 9% driven by strong performance in FDF, CDMO, Onco API and Bio division. In the CDMO space, we are delivering on multiple RFPs involving higher chemical complexity and scale with increased customer engagement focusing on several sustainable technology platforms. Our on-going innovative CGT investment continue to report significant updates for the period under review, especially successful NexCAR19 commercial launch in India to treat cancers. We are entering FY25 with solid foundation and remain committed to grow by focusing on R&D led commercial excellence. We are prioritizing efforts to improve margin, particularly increasing asset utilization across network and delivering late phase commercial opportunity. At the same time, we have been investing in Laurus future and continuing to create value for all stakeholders.”

V V Ravi Kumar, Executive Director & Chief Financial Officer said; “Overall FY24 reported operating result was challenging driven by selling price decline in ARV products, absence of large PO, and continued OPEX on growth projects/new initiatives. We achieved Rs 5,041 crs in revenues, representing 17% decline. Excluding the large PO the underlying growth was 9% over last year. Gross margin was 51.7% and EBITDA at Rs 798 crs resulting in 15.8% margin. The EBIDTA margin for the Q4FY24 is at 18.0% and reflecting sequential improvement. Despite operational challenges, our committed capacity built-up is on track and continuing our focus on productivity improvement. Going ahead, we are fully focusing on gradually returning to growth, prioritising investments in high value segments, improving Net debt leverage while defining our strategic roadmap to ensure long-term profitable and sustainable growth. We are pleased with our Q4 sequential improvement, supported from all divisions.”

Laurus Labs : Consolidated Results

	Quarter ended			Year ended
Particulars	202403	202303	Var.(%)	202403	202303	Var.(%)
Net Sales (including other operating income)	1,439.67	1,380.90	4.26	5,040.83	6,040.55	-16.55
OPM (%)	16.77	20.68	-390 bps	15.42	26.36	-1,093 bps
OP	241.49	285.54	-15.43	777.50	1,592.19	-51.17
Other Inc.	18.53	1.71	983.63	26.34	6.00	339.00
PBIDT	260.02	287.25	-9.48	803.84	1,598.19	-49.70
Interest	50.50	53.10	-4.90	182.90	165.17	10.73
PBDT	209.52	234.15	-10.52	620.94	1,433.02	-56.67
Depreciation	102.25	87.01	17.52	384.58	324.08	18.67
PBT	107.27	147.14	-27.10	236.36	1108.94	-78.69
Share of Profit/(Loss) from Associates	-0.3	-1.97	84.77	-5.94	-3.21	-85.05
PBT before EO	106.97	145.17	-26.31	230.42	1105.73	-79.16
EO Income	0	0	-	0	0	-
PBT after EO	106.97	145.17	-26.31	230.42	1105.73	-79.16
Taxation	31.95	39.9	-19.92	68.15	312.3	-78.18
PAT	75.02	105.27	-28.74	162.27	793.43	-79.55
Minority Interest (MI)	-0.59	2.29	LP	1.72	3.32	-48.19
Net profit	75.61	102.98	-26.58	160.55	790.11	-79.68
P/(L) from discontinued operations net of tax	0	0	-	0	0	-
Net profit after discontinued operations	75.61	102.98	-26.58	160.55	790.11	-79.68
EPS (Rs)*	1.40	1.91	-26.58	2.98	14.66	-79.68

* EPS is on current equity of Rs 107.79 crore, Face value of Rs 2, Excluding extraordinary items.
# EPS is not annualised
bps : Basis points
EO : Extraordinary items
Figures in Rs crore
Source: Capitaline Corporate Database

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