RATING

RECOMMENDATION

Strong Sell

  • ROFR Required
  • Available in Depository:

  • NSDL

  • CDSL

  • Available for Investment:

  • Primary

  • Secondary

RATING

RECOMMENDATION

Strong Sell

Business Type

Traditional Business

RATING

RECOMMENDATION

Strong Sell

Business Type

Traditional Business

  • Arch Pharmalabs Growth

Get detailed information about the Arch Pharmalabs Share Price. In this research report, you will get to know about Arch Pharmalabs Peers data. In addition, get the complete details about the Net Profit Growth, Revenue Growth and Book Value Growth.

Arch Pharmalabs Revenue Growth

Growth in %

  • 22.57%

    1 Year

  • 24.55%

    2 Year

  • 47.78%

    3 Year

  • The company's revenue has grown from Rs. 652 cr. in FY20 to Rs. 799 Cr in FY'21. One of the key reasons for this growth was increased operational activities at the manufacturing sites, along with it the revenue grew due to the impact of covid 19 and the china plus one strategy. After china, only India and the EU have the advantage of producing API and India is a better choice than the EU, due to lower costs.
  • The company's operating revenue includes API/Intermediate sales and other operating sales, the API sales increased from Rs. 630 cr. in FY20 to Rs. 683 cr. in FY21, and other operating incomes increased from Rs. 2 cr. in FY20 to Rs. 227 cr. in FY21. While the company's other income increased from Rs. 19 cr. in FY20 to Rs 92 crore in FY21, the main reason was a 382% increase in other non-operating revenue year on year (y-o-y).

Arch Pharmalabs Net Profit Growth(PAT)

Growth in %

  • NA

    1 Year

  • NA

    2 Year

  • NA

    3 Year

  • The company reported a loss of Rs 891 crore in FY21, compared to a loss of Rs 183 crore in FY20, a 5 times increase. In FY21, the company's revenue per expense was 0.47, compared to 0.78 in FY20. The reason for this year-on-year increase in losses is due to an increase in operating expenses and interest costs. The operating expenses reached to Rs. 892 cr in FY21, which is primarily attributable to the rise in establishment costs which were incurred due to bad debts and provisions written off worth Rs.1,406 cr., while the increase in interest expense was 9% sequentially. But altogether the company reported a profit of Rs. 1869 cr. in FY21 which was due to exceptional items.
  • The respective exceptional item/gain of Rs. 2781 cr. is related with loans/interest written back (by JM financials Asset reconstruction) for FY21.

Arch Pharmalabs EPS Growth

Growth in %

  • NA

    1 Year

  • NA

    2 Year

  • NA

    3 Year

The company's EPS has increased dramatically, standing at Rs.123 per share in FY21, up from Rs.-11 in FY20. The reason for this exponential growth was expectational items worth Rs. 2761 cr. in loans/interest written back. However, the company loss is Rs 891 cr. when the expectational items are removed from the FY21 net profit. The company's share count remains unchanged at 15,19,23,076.

  • Arch Pharmalabs Book Value Growth

Growth in %

  • NA

    1 Year

  • NA

    2 Year

  • NA

    3 Year

  • The company's book value for FY21 was Rs -45 per share in comparison to Rs -99 per share in FY20. The book value of the company has been negative for the past few years due to negative total equity. This is due to a series of losses each year which leads to a negative reserves account balance for the company.
  • In FY21 the company reported a loss of Rs. 891 cr. while the net income after the adjustment of exceptional items was positive Rs.1,896 cr. which lead to an increase in other Reserves and surplus from Rs. -2,302 cr. in FY20 to Rs. - 467 cr. in FY21. This increase led to an overall rise in book value by 55% y-o-y. While the outstanding shares of the company remain the same at 15,19,23,076.

Arch Pharmalabs EBITDA Growth

Growth in %

  • NA

    1 Year

  • NA

    2 Year

  • NA

    3 Year

The EBITDA for the company has fallen from Rs 55 cr. in FY20 to Rs. - 633 cr. in FY21. The reason for this massive rise in the losses was due to the rise in establishment expenses which were accounted for bad debts written off and deposits written off by Rs 830 cr. and Rs. 577 cr. respectively, along with this, there was a significant rise in employee benefits expense of 20% y-o-y.

Arch Pharmalabs Operating Profit Growth

Growth in %

  • NA

    1 Year

  • NA

    2 Year

  • NA

    3 Year

The operating income of the company for FY21 is at Rs -891.45 cr. in comparison to Rs. -183 cr. in FY20. The overall fall in the EBT was driven by the EBITDA which was Rs. -633 cr. for the same period. were as the overall PBT was amplified due to an increased interest cost of Rs 231 cr. in FY21 in comparison to Rs. 211 cr. in FY20, reason for this rise in interest cost was the capital restructuring by JM Financial ARC.

Arch Pharmalabs Asset Growth

Growth in %

  • -24.03%

    1 Year

  • -14.49%

    2 Year

  • -6.89%

    3 Year

Total assets have decreased from Rs 3,109 cr. to Rs 2,362 cr. This is primarily due to a decrease in. trade receivables, inventory, short-term loans & advances, and long-term investments by Rs 165 cr. , Rs. 61 cr. , Rs. 322 cr. and Rs. 145 cr. respectively in FY21. This significant drop in trade receivables is due to a payment from 6-month debtors of several Rs. 124 cr., as well as a decrease in short-term loans and advances due to payment received from advances against supplies and services.

Arch Pharmalabs Cash Flow from Operations

Growth in %

  • 48.51%

    1 Year

  • 327.04%

    2 Year

  • NA

    3 Year

Cash flow from operations showed a significant rise in FY21. It was Rs.187 cr. in FY20 and rose to Rs. 287 cr. in FY21. The rise primarily accounts because of the addition in current liabilities and adjustment of establishment expenses (The expenses and asset purchases associated with getting the business started are included in the establishment costs) by Rs. 216 cr. and Rs. 756 cr. in FY21.

  • Arch Pharmalabs Solvency Ratios

Arch Pharmalabs D/E Ratio

The company's overall debt to equity ratio has improved, with total debt falling to Rs. 1,049 cr. in FY21 from Rs. 3,070 cr. in FY20. The reason for this significant decline is a drop in Non-current other Term loans from Rs 2,972 crore in FY20 to Rs 1,029 crore in FY21 which is assumed to be acquired by JMFARC. Whereas the company's overall equity increased from Rs. -1604 cr. in FY20 to Rs 232 cr., this was due to exceptional gains of Rs. 2761 cr.

Arch Pharmalabs Current Ratio

The current ratio of the company has declined from 1.4 in FY20 to 1.2 in FY21, showcasing a decline of 13% y-o-y. The major reason for this decline was a decrease in overall current assets due to a fall in trade receivables, inventory, and short-term loans & advances by Rs 165 cr., Rs. 61 cr., and Rs. 322 cr. respectively in FY21. While the overall other current liabilities fell by 34% due to a major decrease in short-term liabilities and another current lability by 74% and 51% respectively.

Arch Pharmalabs Quick Ratio

Arch Pharmalabs Interest Coverage Ratio

The interest coverage ratio fell to negative 2.9 due to negative EBIT for FY21 of Rs. 661 cr. and an increased interest cost by 9 % y-o-y

  • Arch Pharmalabs Operating Efficiency

There is a marginal decrease in EBIT, EBITDA, PBT, and PAT margin% primarily on account of a fall in net income due to the establishment expenses in FY21, along with it the company despite having top-notch production facilities, the company has struggled to raise financing due to its inadequate net worth position and inability to secure long-term contracts with clients and suppliers.

Arch Pharmalabs Operating Profit EBIT Margin(OPM)


Arch Pharmalabs Profit Before Tax Margin (PBT Margin)

Arch Pharmalabs Profit After Tax Margin (PAT Margin)

  • Arch Pharmalabs Profitablity Ratio

Arch Pharma Labs Limited has been losing money since 2018 and was only able to generate a profit in FY21 due to exceptional items worth Rs 2760 crore. As a result, the profitability ratios for this company should not be considered because they are untrustworthy.

Arch Pharmalabs Return on Equity(RoE)

The ROE of the company has been negative for the past 3 years, this was due to losses and negative total equity. As per Dupont Analysis, the net income margin and the equity multiplier drove the overall decrease in the ROE. Net income margin has witnessed a growth of 950% in FY21 from FY20, the reason being the increase in PAT of the company due to exceptional items of Rs. 2,760 cr. due to interest/loans written back along with it the equity multiplier was at -4 reason being the negative reserves and surplus due to losses carried forward from the past 3 years.  Overall, the asset turnover ratio has increased by 29% this was due to increased operating revenue in FY21 by 12% and a decrease in total assets. 

Arch Pharmalabs Return on Capital Employed(RoCE)

The ROCE are the company dropped down to a negative 48%, this was due to the negative EBIT in FY21 of Rs. 660 cr. which drove the whole ratio. While the capital employed of the firm has decreased by 13% y-o-y due to decreased long-term debt in FY21 by 66% as it was acquired by JMFARC according to the Asset reconstruction agreement between both entities in 2016.

Arch Pharmalabs Return to Assets (RoA)

The ROA of the company rose to 68% in FY21, the reason for this rise is the net income of Rs.1869 cr. which the company reported in FY21 due to exceptional items of Rs. 2760 cr. in due to interest written back. While the assets of the company have fallen y-o-y by 14% reason being the decline in the short-term loans and advances as well as trade receivables in FY21

  • Arch Pharmalabs Valuation Ratios

Arch Pharmalabs Earning Yield