October 27, 2016

Biocon's Jul-Sep results analysis

Last Thursday (20-Oct-2016), I did the Jul-Sep quarter results analysis for Biocon Ltd, for the organization I work for currently. Here is what I contributed:

Earnings Review: Biocon Jul-Sep PAT at 1.47 bln rupees

Bio-pharmaceutical company Biocon Ltd recorded a consolidated net profit of 1.47 bln rupees in Jul-Sep, the recorded as against a net loss of 106 mln rupees in the year-ago quarter. The profit growth was aided by a sharp rise in sales and lower raw material costs.

Consolidated net sales of Biocon grew nearly 20% on year to 9.40 bln rupees in the September quarter, driven by a steady 17.1% growth on year in revenues from its largest product segment of small molecules to 4.03 bln rupees and a sharp 34.4% on year increase in its biologics product sales to 1.56 bln rupees.

Biocon's revenues from research services and branded formulations business segments recorded year on year growth of near 16% and 14.5% to 3.03 bln rupees and 1.37 bln rupees respectively.

The company's net profit was in line with estimates. An average of estimates of nine brokerages had pegged the quarter's net profit at 1.46 bln rupees. Net sales was below the average estimate of 9.85 bln rupees.

Chairperson and managing director of Biocon, Kiran Mazumdar-Shaw was quoted in a company statement as saying that the company's performance in Jul-Sep was led by strong growth across all its verticals. "Expansion of our biologics footprint in emerging markets and licensing agreements boosted the revenue further," she said.

The growth in small molecules was driven by sales in emerging markets of Africa, West Asia and South America and to India based customers servicing the needs of the US market. Biologics vertical, the company said, saw strong growth of 26% at nearly one bln rupees on account of sales in emerging markets of Africa, West Asia and South America.

Operating margin of the biopharmaceuticals company jumped up to 25.2% in the September quarter from 21.2% in the year-ago quarter. The 400 bps rise in operating margin was chiefly due to a 6.3% fall on year in cost of material consumed to 3.18 bln rupees.

Total expenditure was up 13.7% on year to 7.82 bln rupees. Research and development expenses in the September quarter was 6.8% of sales, up from 5.3% in the June quarter.

Finance costs increased 2.2 times year on year to 65 mln rupees and the tax payment was 48% up on year at 417 mln rupees. 'Other income' was up 69% higher on year at 384 mln rupees in Jul-Sep.

Shaw said Biocon's insulin Glargine pen launched in Japan was well received in the September quarter with prescriptions beginning to gain traction. The quarter also saw the European drug regulator accept for review

Biocon's application to market its biosimilar Trastuzumab co-developed by Biocon and Mylan.

The company received a tentative approval from US FDA for its generic drug, Rosuvastatin Calcium tablets. The company also said that its facilities in India had completed regulatory audits by MCC South Africa and US FDA in the September quarter.

From the June quarter, Biocon's net profit was down 11.9% and its net sales was down 4.2%.

October 26, 2016

Re-blogging an old blog post (28-Feb-2012) on Tata Sons

Re-blogging an old blog post (28-Feb-2012) on Tata Sons


ife in financial markets: tata sons issues Rs 58 crore worth of preference shares to 9 people including ratan tata

Here is something that is of some relevance to shareholders in listed Tata Group companies which they won't get to know of immediately under the disclosure norms of the listing agreements with the National Stock Exchange of India and BSE. 
On December 30 last year (2011) and January 2 this year (2012), Tata Sons, the holding company for all Tata Group companies, issued 5.78 lakh new 7.5% cumulative redeemable preference shares of Rs 1,000 each to nine people, as per the mandatory statutory filings made by the company under The Companies Act, 1956 (as amended till date). 
Issued at a par value of Rs 1,000 each, the preference shares issue fetched Tata Sons a sum of Rs 57.78 crore in cash. Prior to issue of these preference shares, the paid-up preference shares capital of Tata Sons was Rs 4,089 crore, made up 408.9 lakh preference shares of Rs 1,000 each. The paid-up equity share capital of Tata Sons, as of January 2 this year (2012) was Rs 40 crore comprising of 4 lakh equity shares of Rs 1,000 each.
Of the new Rs 58 crore worth of preference shares issued at par,
-- Rs 25 crore worth preference shares was issued to Narotam S Sekhsaria, founder and promoter of Gujarat Ambuja Cements who headed it till six years ago,
-- Rs 11.52 crore worth of preference shares was issued to Noshir Adi Soonawala, a Tata Group veteran,
-- Rs 10 crore worth of preference shares was issued to Ratan Tata,
-- Rs 6.16 crore worth of preference shares was issued jointly to Ravi Kant and Arti Kant. Ravi Kant is a Tata Motors veteran,
-- Rs 2 crore worth of preference shares was issued to Arunkumar R Gandhi,
-- Rs 1 crore worth of preference shares was issued jointly to Praveen P Kadle and Chetana P Kadle,
-- Rs 1 crore worth of preference shares was issued to Farrokh K Kavarana
-- Rs 0.6 crore worth of preference shares was issued jointly to Jamshed J Irani, Daisy J Irani and Zubin J Irani,
-- Rs 0.5 crore worth of preference shares was issued jointly to Simone N Tata & Noel N Tata.

October 20, 2016

Analysis of Hindustan Zinc's segment results in Apr-Sep FY17

Silver sales growth of 26% spurs Hind Zinc Apr-Sep financials

The silver lining in the otherwise falling trend in Hindustan

Zinc Ltd's sales and profit was the silver metal itself.

    An analysis of the September quarter results declared by the miner today

revealed silver's rising contribution to the company's revenue and earnings

before interest and tax.

    In Jul-Sep, the miners's revenue from silver sales increased sharply by

25% on year to 4.82 bln rupees aided by steady production and around 30% on

year increase in silver prices. Revenue from zinc and lead declined year on

year by 14% and 10% each to 27.0 bln rupees and 5.0 bln rupees respectively.

    This trend extended to, and was accentuated in, the first half of

2016-17. In Apr-Sep, silver revenue rose 26% on year to 8.4 bln rupees while

zinc sales fetched 46.2 bln rupees, 25% lower than the year-ago period.

    Volume growth in the first half of 2016-17 was 6% on year to 196 mln

tonnes in silver, while zinc and lead volumes contracted by 37% and 17%


    An analyst said the fall in zinc and lead volume and sales was on

expected lines and silver production was expected to increase as well. If the

company management wants to, it can ramp up the silver production from around

450 mln tonnes to 730 mln tonnes, he said.

    Operating margin from silver held steady for the miner in contrast with

falling margins in zinc and lead.

    The earnings before interest and tax in silver in the September quarter

was 3.8 bln rupees, giving a margin of 79.2%, down just 30bps from the

year-ago quarter. The EBIT margin in zinc, lead and other metals, taken

together, in Jul-Sep fell 600 bps to 37.9%.

    The first half of 2016-17 saw a higher difference in the EBIT margin

growth rates. EBIT margin in silver went up sharply on year by 250 bps to

78.6% on year, while that in zinc, lead and others fell by a steep rate of

1010 bps to 29.3% year on year.

    The company said in its earnings statement that integrated silver

production was up 6% on year in first half of 2016-17 despite lower mined

metal, on account of significantly higher production from Sindesar Khurd

mine. "For the full year, integrated silver production will be higher than FY

2016", the company said.

    In 2015-16, the revenue from silver had increased by nearly 17% on year

while revenues from zinc, lead and other metals fell 6.2%.