Q4 revenues grew 11.0% YoY to Rs. 757 crore. Domestic sales grew 23.2% to Rs. 218 crore whereas emerging markets (branded) de-grew 10.5% YoY to Rs. 273 crore amid logistical challenges in Asia and Africa. US sales grew 21% to Rs. 173 crore. Africa tender business grew 86% YoY to Rs. 80 crore. EBITDA margins improved significantly to 34.3% (vs. 22.2% in Q4FY20) amid better gross margins and lower other expenditure. EBITDA grew 71.4% YoY to Rs. 259 crore. PAT grew 21% YoY to Rs. 159 crore. Delta vis-à-vis EBITDA was mainly due to lower other income and higher tax rate.
Valuation & Outlook
Q4 revenue was mostly in-line with expectations, albeit skewed. Profitability was better-than-expected due to lower-than-expected other expenses leading to a strong margin performance. The management expects to continue to outperform the market in the Branded Generic space, in domestic and export markets both. We expect the US to maintain its 20% growth momentum, going ahead. On the margin front, we expect Ajanta's performance to remain stable at +30% with the current run-rate of other expenses (the new base) to be moderated by slightly higher spend on R&D and increased MR activity. Overall, calculated focus, healthy margins, return profile and lighter balance sheet are some key differentiators for Ajanta. The company remains a play on global branded generics space. We maintain BUY rating and arrive at our target price of Rs. 2250 (unchanged) based on 24x FY23E EPS of ~Rs. 93.8.
For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_AjantaPharma_Q4FY21.pdf
Shares of AJANTA PHARMA LTD. was last trading in BSE at Rs.1834 as compared to the previous close of Rs. 1890.2. The total number of shares traded during the day was 12717 in over 1277 trades.
The stock hit an intraday high of Rs. 1932.45 and intraday low of 1826.75. The net turnover during the day was Rs. 23641029.