🧪 Divi’s Laboratories Ltd is an India based manufacturer of Active Pharmaceutical Ingredients (APIs) and Intermediates. The company is engaged in manufacture of leading generic compounds Nutraceutical ingredients and custom synthesis of APIs and intermediates for global innovator companies. Divi’s is among the largest pharmaceutical companies in India with a portfolio of 120 products across diverse therapeutic areas.
The company has four manufacturing facilities and market presence across several countries.
Divi’s has a successful track record of executing the custom synthesis business for innovator customers, and being one of the largest generic API manufacturers globally, it has been among the large beneficiaries of this trend. Its longstanding relationships with customers, cost competitiveness and innovation strengths are also some of the reasons that make it a preferred play.
The company only manufactures select APIs with high complexities and ensures limited competition. The focus on limited products also brings cost advantages that ensure good margins. Besides, it remains a preferred choice for large pharmaceutical manufacturers.
Lets look at key stats and highlights of Divi’s Labs Q4 Results 2022:
Divi’s Labs Q4 Results 2022 – Highlights
Source – Bloomberg
- The revenue of the company for Q4 – 22 surged by 40.8% to Rs. 2,518.4 crore in Q4 – 22 from Rs. 1,788.1 crore in the period under review of the last year.
- EBITDA of the company rose by 54% from Rs. 716.2 crore in Q4 -21 to Rs. 1,104.4 crore in Q4 – 22.
- Net Income of the company surged by 78.2% from Rs. 502 crores in Q4 – 21 to Rs. 894.6 crores in the period under review.
- EPS of the company rose from 18.91 in Q4 – 21 to 33.70 in Q4 – 22.
- The Board of Directors of the Company has recommended a dividend of Rs. 30 per share of face value Rs. 2 each i.e., 1500 per cent for the financial year 2021-22, subject to the approval of members at the ensuing Annual General Meeting – the Pharma company said in release.
- The company’s PE ratio is at 45.1.
- It is also the preferred choice in the CRAMS segment, enjoying a strong relationship with six of the top 10 big pharma companies.
Divi’s Labs – Analysis of Liquidity
- The liquidity ratio of a small business will tell the potential investors and creditors that your company is stable and strong and also has enough assets to combat any tough times.
- Cash ratio of the company has increased from 1.94 in Q4-21 to 2.36 in Q4-22. This indicates that the company has lower short term liabilities as well as more cash in hand.
- Current ratio indicates the position of the company to meet its short term obligations, which has improved significantly by 25% from current ratio being 5.55 in Q4-21 to 6.99 in Q4-22.
- Quick ratio also known as acid test ratio helps to measure how much short term liabilities of the company can be paid with its most liquid assets.
- The increase in quick ratio of the company from 3.44 in Q4-21 to 4.39 in Q4-22 a 27.6% increase shows that the company is doing significantly well to cover its short term liabilities.
- A shorter cash conversion cycle indicates that the company is healthier and has a fast inventory to sales pipeline and it also means that the company needs fewer days to recover money spent on materials. The company’s cash conversion cycle was 293.36 in Q4-21, which has decreased significantly by 17.97 to 275.39 in Q4-22.