Ajanta Pharma (AJANTPHARM) Q4 17/18 earnings summary

Executive summary

• FY18 consolidated revenue from operations rose 6% to ₹2,131 cr, while net profit fell 8% to ₹469 cr amid higher R&D, gratuity costs and underutilised new plants.

• Branded generics in emerging markets and new US launches supported growth; Africa institutional sales declined, while US pricing pressure and competition remained headwinds.

Financial highlights

• Consolidated total income was ₹2,155 cr versus ₹2,026 cr; revenue from operations was ₹2,131 cr versus ₹2,002 cr, up 6% YoY.

• Consolidated EBITDA was ₹658 cr, down 6%; PBT was ₹623 cr, down 4%; PAT was ₹469 cr, down 8% YoY.

• Basic EPS was ₹53.26 versus ₹57.59; total comprehensive income was ₹472 cr versus ₹504 cr.

• Material costs improved to 19% of revenue from 21%; employee expenses increased to ₹376 cr from ₹295 cr, including higher gratuity costs and the full-year effect of staffing additions.

Outlook and guidance

• India industry recovery was expected after GST-related destocking and demonetisation effects eased; specialty-segment focus, new products and improved field-force productivity were priorities.

• Emerging-market growth was expected to continue through differentiated launches, customised products and stronger field execution; stable currencies in key markets supported confidence.

• US strategy prioritised a narrower product selection, increased ANDA filings, faster launches, compliance and focused execution; institutional anti-malaria allocations were expected to fall sharply.

• R&D investment and manufacturing technology remained growth priorities; R&D spend was 9% of turnover in FY18.