C O M P A N Y

India

Venus Remedies

22 Apr 2013
Sector: Pharma
BSE Code
CMP (Apr 22’)
Nifty
Equity Cap (m)
Shares (m)
Ma...
Company Report: Venus Remedies

22 Apr 2013

Company continues on stable growth path

9M FY13

9MFY12

Chg YoY (%)

Net sa...
Company Report: Venus Remedies

22 Apr 2013

Stable performance in Q3
Particulars (` mn)

Q3 FY'13

Net sales
Other Operat...
Company Report: Venus Remedies
Key Ratios

22 Apr 2013

Q3 FY'13

Q3 FY'12

Q2FY'13

EBITDA Margin

26.55%

24.79%

25.98%...
22 Apr 2013

Company Report: Venus Remedies
Ahlcon Parenterals

760

169

22%

83

11%

Parenteral Drug

213

-14

-7%

-7...
Company Report: Venus Remedies

22 Apr 2013

Potentox is an AMR efficient anti-biotic product used for Hospital
acquired P...
Company Report: Venus Remedies

22 Apr 2013

Patents all over the globe
Elores is a strongly patented product with patents...
Company Report: Venus Remedies

22 Apr 2013

commercialise the product by out-licensing it in these regions.
The total Ant...
22 Apr 2013

Company Report: Venus Remedies
Valuation: Still cheap despite recent gains

Price

Market
Cap

EV

TTM
Sales
...
22 Apr 2013

Company Report: Venus Remedies

Financial Annexure
Profit & Loss Statement
Income Statement

FY'08

FY'09

FY...
Company Report: Venus Remedies

22 Apr 2013

Balance Sheet
Balance Sheet

FY'08

FY'09

FY'10

FY'11

FY'12

85

85

85

9...
22 Apr 2013

Company Report: Venus Remedies

Cash Flow Statement
Cash Flow Statement
Net Profit/(Loss) before Tax

FY'08

...
22 Apr 2013

Company Report: Venus Remedies

Ratios
Ratios

FY'08

FY'09

FY'10

FY'11

FY'12

EPS

42.4

52.0

46.7

50.6...
Company Report: Venus Remedies

22 Apr 2013

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Venus Remedies Research Report Update

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Venus Remedies took another step on its R&D journey with its first market authorisation deal with a pharma major in South Africa. The company also launched a key R&D product, Elores, in India, which it expects to become a Rs2bn product in the next 5 yrs. We believe Venus is beginning to show results from its R&D program. With Venus’ intent on monetising its R&D pipeline, there is strong likelihood of continued positive news flow, which should lend buoyancy to the stock price.

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Venus Remedies Research Report Update

  1. 1. C O M P A N Y India Venus Remedies 22 Apr 2013 Sector: Pharma BSE Code CMP (Apr 22’) Nifty Equity Cap (m) Shares (m) Market Cap (m) U P D A T E Rs 252 Positive research results 526953 252 5,834 3,073 10.54 2,652 NSE Code 52W H/L Sensex Face Value Free Float 3M Avg Vol VENUSREM 327/158 19,169 10 65.78% 12,857 Rs We believe Venus is beginning to show results from its R&D program. With Venus’ intent on monetising its R&D pipeline, there is strong likelihood of continued positive news flow, which should lend buoyancy to the stock price. Shareholding- 31st Dec-2012 20% Promoter 34% FII Breakthrough in R&D IP commercialisation with a marketing deal with South African pharma major DII Others 32% Venus announced its first out-licensing deal in Feb, where it granted South African pharma major, Adcock, exclusive marketing rights for its research product Potentox. Bodies Corporate 14% Venus Remedies took another step on its R&D journey with its first market authorisation deal with a pharma major in South Africa. The company also launched a key R&D product, Elores, in India, which it expects to become a Rs2bn product in the next 5 yrs. 0% This deal strengthens our confidence in company’s IP wealth and its ability to find out-licensing partners. More such deals for multiple geographies for its R&D pipeline are expected in 2013. 350 300 Two new R&D patented Elores 250 200 products launched, including US Venus launched US patented anitibiotic Elores in Indian market in January this year. The company is targeting Rs 5bn revenue from AMR capable Elores in the next five years. Venus also launched patent protected, topical nanoemulsion, Trois in India for arthritic pain. 150 100 50 Got two patents for Vancoplus 0 Apr-12 Jun-12 Aug-12 Oct-12 Dec-12 Feb-13 Venus Remedis Sensex Consolidated Financials The company received patents from Canada and Mexico for its R&D product Vancoplus. Vancoplus is a novel AMR product to combat MRSA infection. Company already has manufacturing facility in compliance with Canadian regulations for Vancoplus. FY'11 FY'12 9mFY'13* 3,631 4,098 3,341 EBITDA 892 1,028 884 PAT 462 470 452 EBITDA(%) 24.6 25.1 26.3 PAT(%) 12.7 11.5 13.4 ROE(%) 22.6 17.3 - Venus Remedies has showed respectable growth in revenue of 15.7% Y-o-Y posting Rs3,341mn revenue in 9mFY13. It posted PAT of Rs452mn, up by 26.6% Y-o-Y from same period last year, on account of lower interest cost, taxes and other expenditures. ROCE(%) 19.1 16.3 - Valuations 3.9 3.4 4.4# 4.1 50.6 3.6 4.1# 48.3 62.3# Sales P/E Ratio(x) EV/EBITDA(x) EPS (Rs) *Standalone, #ttm Rs mn Company performance as per expectations Venus quotes at 4.4x ttm EPS. This is very cheap given its consistent top-line growth and steady progress in R&D. Valuation should improve with expected R&D commercialisation deals and R&D product launches. Four-s reports are available on BLOOMBERG, Reuters, Thomson Publishers and Market Publishers
  2. 2. Company Report: Venus Remedies 22 Apr 2013 Company continues on stable growth path 9M FY13 9MFY12 Chg YoY (%) Net sales 3,340.7 2,886.4 15.7 Other Operating Income Total Operating Income Total Expenditure Consumption of Raw Materials 19.5 3,360.2 2,476.1 1,939.9 23.1 2,909.5 2,142.9 1,674.7 -15.6 15.5 15.5 15.8 -61.1 -90.5 -32.5 173.5 166.2 4.4 Particulars (` mn) (Increase) / Decrease In Stock In Trade & WIP Employees Cost Other Expenditure 423.8 392.6 8.0 EBITDA Depreciation 884.1 237.6 766.5 183.4 15.3 29.6 EBIT Interest & Finance charges 646.6 182.8 583.2 186.4 10.9 -1.9 7.4 1.8 311.1 PBT Tax Expense 471.2 19.2 398.6 41.5 18.2 -53.7 PAT 451.9 357.1 26.6 Other Income Rs mn *Standalone (Source: Capitaline, company reports) Stable growth registered in last 9 months driven by domestic and key segments Venus Remedies has posted revenue of Rs 3,341mn for 9mFY13, a Y-o-Y growth of 15.7%. The company has performed well in all 3 quarters this year while growing at 15-16% on Y-o-Y basis. Driven by domestic market and key therapeutic segments Oncology sales grew 22% in 9mFy13 This consistent growth is due to good demand from domestic market for the company’s products. Domestic market grew 17% during this period. The institutional division also reported good sales, showing a growth of 30% from Rs 219mn during 9mFY12 to Rs 285mn for 9mFY13. The anti-cancer segment, the key segment for Venus, also had good growth during this period. The segment registered a growth of 22% Y-o-Y growing to Rs 1,064mn from Rs 874mn in last year. Along with anti-cancer, SVP segment also grew by 21% during this period. The company has shown performance on the expected line till now and is expected to grow along similar trend of 13-15% for the next 1-2 years. This 15% growth is excluding the growth by commercialising its IP wealth. Four-S Research 2
  3. 3. Company Report: Venus Remedies 22 Apr 2013 Stable performance in Q3 Particulars (` mn) Q3 FY'13 Net sales Other Operating Income Total Operating Income Total Expenditure Consumption of Raw Materials (Increase) / Decrease In Stock In Trade & WIP Employees Cost Other Expenditure EBITDA Depreciation EBIT Interest & Finance charges Other Income PBT Tax Expense PAT Q3 FY'12 Q2 FY'13 Chg YoY (%) 1,104.1 4.0 1,108.1 820.2 652.2 Chg YoY (%) 18.7 -44.5 17.5 14.8 20.2 1,116.2 10.1 1,126.4 827.3 635.4 940.0 18.2 958.3 720.8 528.6 0.6 -2.9 -31.9 118.7 -101.7 58.4 133.1 299.0 80.1 218.9 52.9 3.5 169.4 8.9 160.6 55.9 139.2 237.5 61.3 176.2 66.8 1.0 110.4 7.1 103.3 58.1 141.9 287.9 79.8 208.1 53.7 2.7 157.1 6.2 150.9 4.3 -4.4 25.9 30.6 24.3 -20.8 238.2 53.5 25.4 55.4 0.5 -6.2 3.9 0.4 5.2 -1.5 28.3 7.9 44.1 6.4 1.1 151.7 1.6 0.9 -2.6 Rs mn The company had a good third quarter this year with revenue growing by 18.7% Y-o-Y from Rs940mn to Rs1,116mn. Top-line was supported by good traction in the export market. Exports grew by 26.3% during this quarter. The company’s key segment anti-cancer grew by 25.3%. Venus had strong net margin improvement this quarter as PAT grew 55% from Rs 103mn in Q3Fy12 to Rs 160mn in Q3Fy13. The Company lowered interest charges this quarter by refinancing the loan with FCCB. Maintains profitability Company reported EBITDA of Rs 884 and PAT of Rs 452mn in 9mFy13 compared to Rs 767mn EBITDA and Rs 357mn PAT, respectively, during the same period last year. EBITDA margin of 26.3% for 9mFY13 was largely in line with last year. For Q3 FY13, Venus reported EBITDA margin of 26.5% and PAT margin of 14.5%. The increasing contribution from oncology segment and growing revenue from its R&D products is helping the company to sustain these margins levels. Four-S Research 3
  4. 4. Company Report: Venus Remedies Key Ratios 22 Apr 2013 Q3 FY'13 Q3 FY'12 Q2FY'13 EBITDA Margin 26.55% 24.79% 25.98% Net Margin 14.25% 10.78% 13.62% Total Expenditure/ Total Operating Income 73.45% 75.21% 74.02% Raw Material Cost/ Total Operating Income 56.46% 54.85% 55.98% 5.18% 5.84% 5.24% 11.82% 14.52% 12.81% Staff Cost/ Total Operating Income Other Expenditure/ Total Operating Income Key Ratios 9M FY13 9MFY12 EBITDA Margin 26.31% 26.35% Net Margin 13.45% 12.27% Total Expenditure/ Total Operating Income 73.69% 73.65% Raw Material Cost/ Total Operating Income 55.91% 54.45% 5.16% 5.71% 12.61% 13.49% Staff Cost/ Total Operating Income Other Expenditure/ Total Operating Income *Standalone (Source: Capitaline, company reports) Margins compare favourably with peers Venus Remedies continued to maintain its margin edge over its midsize phama peers. Its high margin oncology segment which contributed around 30% to revenue and R&D products which contributed 25-26% to total revenue are the key drivers of strong margins. As research products contribution to revenue is expected to move up, margins could expand going forward. Better profitability supporting the growth 9M FY13 Total Income EBITDA EBITDA Margin Net Income Net Income Margin Ajanta Pharma 5,812 1,507 26% 740 13% Indoco Remed 4,660 684 15% 298 6% Natco Pharma 4,696 1,148 24% 687 15% 12,572 2,157 17% 600 5% 7,049 532 8% -411 -6% 1,683 495 29% 160 10% Company Mid-Cap Peers Nectar Life Parabolic Drugs Injectable Peers Strides Arcolab Four-S Research 4
  5. 5. 22 Apr 2013 Company Report: Venus Remedies Ahlcon Parenterals 760 169 22% 83 11% Parenteral Drug 213 -14 -7% -76 -36% Claris Life 582 218 37% 82 14% Kilitch drugs 260 39 15% 28 11% Average 3,190 578 19% 183 4% Venus 3,341 884 27% 452 14% (Source: Capitaline, company reports) Rs mn Q3’FY13 Company Total Income EBITDA EBITDA Margin Net Income Net Income Margin Ajanta Pharma 2,257 603 27% 326 14% Indoco Remed 1,503 197 13% 74 5% Natco Pharma 1,601 458 29% 262 16% Nectar Life 3,689 761 21% 215 6% Parabolic Drugs 1,503 66 4% -256 -17% 5,973 1526 26% 554 9% Ahlcon Parenterals 272 76 28% 43 16% Parenteral Drug 689 -36 -5% -261 -38% 1,936 693 36% 252 13% Mid-Cap Peers Injectable Peers Strides Arcolab Claris Life 41 4 11% 1 3% Average 1,946 435 19% 110 3% Venus 1,116 299 27% 161 14% Kilitch drugs R&D investments showing results Signs marketing rights deal with South African pharma major Signs outlicensing deal in South Africa for Potentox After 10 years of hard work in building its R&D product portfolio, Venus Remedies has started to realize benefits from its R&D pipeline. The company has made positive stride towards commercialisation of its R&D IP, with its first out-licensing deal for its R&D products. The company signed an exclusive marketing rights deal with major South African pharma major, Adcock, for its research product Potentox. Commercial details for this deal are not available. Adcock Ingram is a 120 year old $2bn market cap company with 10% market share in South African market. Adcock Ingram has got the exclusive marketing rights for 15 years and they will be bringing the product into the market by mid of 2015. Four-S Research 5
  6. 6. Company Report: Venus Remedies 22 Apr 2013 Potentox is an AMR efficient anti-biotic product used for Hospital acquired Pneumonia and Febrile Neutropenia infections. The company has patents in USA, Canada, New Zealand, South Korea, South Africa and Ukraine for Potentox. We expect more similar deals in 2013. With its 25 R&D products kitty, and more than 80 approved patents and 360 applied patents, the company has the potential to make many more such deals. Vancoplus receives patents from Canada and Mexico Gets its first patents in Canada and Mexico Venus Remedies received 2 significant patents for Vancoplus from Canada and Mexico. These are the first patents received by the company from these countries. Vancoplus is an ‘Antibiotic Adjuvant Entity’ (AAE) constituting Ceftriaxone plus Vancomycin along with an adjuvant. Vancoplus helps in restricting and fighting MRSA (Methicillin Resistant Staphylococcus Aureus) and further helps in reducing treatment costs and time. The patent from Canada is important for Venus Remedies as it will allow the company to reach out to the 3rd fastest growing market globally. The patent in Mexio is also the first in that country for Venus, opening the gates of second leading market in the Latin America region. There market for MRSA medicines is fast growing with growing MRSA cases all over the world. Vancoplus has turned out to be a successful product for the company till now with strong revenue growth of 50% for last 3 years with good traction from domestic as well as emerging markets across the globe. Vancoplus also gave the first US patent for the company. Vancoplus also has patents from South Africa, New Zealand, Ukraine and Australia and is expecting patents from Russia, Brazil and Japan soon. Elores: A US patented product launched in India Launches Elores, a powerful antibiotic, highly effective against Superbugs Four-S Research The company has launched its one of the most anticipated products from its AMR product kitty, ‘Elores’, in Jan 2013. It is a novel Antibiotic Adjuvant Entity (AAE) to combat antimicrobial resistance caused by multi drug resistant, ESBL (Extended-spectrum betalactamase) producing strains. Due to its efficacy over AMR, Elores has edge over most of its competitors in the market. Elores has a Antibiotic Adjuvant Entity which makes it effective against even the toughest carbapenemase resistant Metallo-betalactamses. This makes Elores fight even with ‘Superbugs’ which are very difficult to treat due to antibiotic resistance. 6
  7. 7. Company Report: Venus Remedies 22 Apr 2013 Patents all over the globe Elores is a strongly patented product with patents from more than 40 countries all over the globe. It has got patents from US, Australia, Brazil and 37 EU countries. The company has also applied for market authorization in EU and is expecting to get it soon. Patents are also expected from South Korea, Japan and UAE. Elores- Mechanism Elores is effective against multi drug resistant (MDR) pathogens Elores basically consists of an anti-biotic, third generation cephalosporin, along with non antibiotic adjuvant, Disodium Edetate. This third generation cephalosporin works as an inhibitor for beta lactamase. Beta lactamase is an enzyme used by bacteria to resist effect of anti-biotics. This unique antibiotics-adjuvant-entity creates a synergistic effect due to its activity on acquired multiple resistance in Gram Negative Enterococci and Rods, and acts by multiple mechanisms. Elores is effective against toughest multi drug resistant (MDR) pathogens/bacteria which are not susceptible to most of the existing antibiotics. MDR pathogens have developed resistance to anti-biotics by creating enzymes such as Metallo-beta-lactamase (MBL) or NDM-1 (New Delhi metallo-beta-lactamase 1) or ESBL (Extended spectrum beta lactamases) which can break down many common antibiotics. Elores increases cell permeability while working on Cell impermeability mechanism of MDRs, regulate 'Efflux pump over expression', breaks bacterial 'Biofilms', prevents 'Transfer of resistant plasmid' and hence the spread of resistance is controlled. So Elores not only kills resistant pathogens (Bacteria) but also prevents the spread of the resistance. Domestic market for Elores As per the company’s data, Elores can manage to reduce the hospitalization bills for a patient by 30% and drug cost by 50%. Venus’s study finds that, on an average, a patient with hospitalacquired infections stays in hospital for 23 days and in ICU for 11.3 days. Elores can significantly bring down these statistics and so the cost for these patients. As per company provided data, out of total Rs 850cr anti-biotic market in India, Rs 248cr market is contributed to AMR due to ESBL/MBL resistance. Out of this Venus Remedies is planning to capture the market share of Rs 200cr within next 5 years. Plans to launch in international market The company is planning to launch Elores in South Korea in next year. It is also waiting for regulatory approval from EU region. Once it gets that it will be launching Elores in EU market too. With patents in US and other regulated countries, the company will Four-S Research 7
  8. 8. Company Report: Venus Remedies 22 Apr 2013 commercialise the product by out-licensing it in these regions. The total Antibacterial Market in North America is $6,768mn and $7,156mn in Europe. Elores faces a competitive market of around $2,000mn in North America and $2,500mn in Europe ‘Trois’ launched - patent protected topical nano-emulsion for arthritic pain Trios targets rheumatoid arthritis Another patented product from R&D efforts of Venus Remedies, Trois, was launched in India in this period. Trois is a topical nano-emulsion product based on natural medicines for arthritic pain. As per the company it is the only drug available in the market for treating arthritis without any side effects. Many of its competing products have severe side effects and are cytotoxic (toxic to cells). Due to this, Trois can be expected to do well in the rheumatoid arthritis drug market in India. Rheumatoid arthritis drug market in India is expected to reach $672mn by end of this year. Four-S Research 8
  9. 9. 22 Apr 2013 Company Report: Venus Remedies Valuation: Still cheap despite recent gains Price Market Cap EV TTM Sales TTM EBITDA 613 15934 17816 7538 1886 976 16.3 2.4 9.4 63 5962 6999 6136 902 423 14.1 1.1 7.8 425 13652 15872 6112 1413 733 18.6 2.6 11.2 16 3342 13511 16510 2879 755 4.4 0.8 4.7 8 432 5632 9709 901 -321 -1.3 0.6 6.3 Strides Arcolab 861 49454 72521 22104 12394 8462 5.8 3.3 5.9 Ahlcon Parent(I)* 353 2376 2586 935 190 85 27.9 2.8 13.6 Parenteral Drugs 100 2666 6362 2944 -336 -1185 -2.3 2.2 -18.9 Claris Lifescien 188 11500 14016 7627 2711 1039 11.1 1.8 5.2 Kilitch Drugs 23 291 262 427 905 694 0.4 0.6 0.3 Venus Remedies* 252 2652 4873 4475 1176 608 4.4 1.1 4.1 Company TTM PAT P/E EV/ Sales EV/ EBITDA Mid-Cap Peers Ajanta Pharma* Indoco Remedies* Natco Pharma Nectar Lifesci.* Parabolic Drugs* Injectible Peers Rs mn*Standalone (Source: Capitaline, company reports) PE Band chart Strong upside possible if R&D results keep coming in 2013 Four-S Research Venus continues to trade at low absolute valuations, and much below peer averages. It is currently trading at a ttm P/E of 4.4x and ttm EV/EBITDA of 4.1x. The company can have a strong upside going forward, if it continues to show results from its R&D pipeline. 9
  10. 10. 22 Apr 2013 Company Report: Venus Remedies Financial Annexure Profit & Loss Statement Income Statement FY'08 FY'09 FY'10 FY'11 FY'12 FY'13 9M Gross Sales 2,165 2,692 3,144 3,637 4,106 3,341 9 4 4 6 7 0 3,360 Less : Excise Duty 2,156 2,688 3,140 3,631 4,098 -48 -82 -62 -39 -92 -61 1336 1668 1885 2054 2351 1940 73 107 147 171 174 0 119 141 167 200 248 174 Power & Fuel Cost 19 20 17 27 27 0 Selling and Distribution Expenses 62 98 153 198 230 0 Administrative & Other expenses 57 87 91 119 130 424 0 Revenue from Operations Decrease/(Increase) in Stock Raw Materials Consumed Manufacturing/Other expenses Payments to and provision for employees Miscellaneous Expenses Total Expenses EBITDA Depreciation 25 23 14 9 2 1,643 2,063 2,413 2,739 3,070 2,476 512 625 728 892 1,028 884 50 68 125 181 250 238 647 462 558 603 711 778 Other Income 19 3 2 4 5 7 Financial Expenses Profit before tax and Exceptional Items 48 84 141 189 275 183 433 477 464 526 508 471 Exceptional Items - - - - - - Profit before tax 433 477 464 526 508 471 75 37 68 64 38 19 358 440 396 462 470 452 462 470 452 EBIT Tax Profit after tax before minority interest Reported net profit 358 440 396 (Rs mn), consolidated financials Four-S Research 10
  11. 11. Company Report: Venus Remedies 22 Apr 2013 Balance Sheet Balance Sheet FY'08 FY'09 FY'10 FY'11 FY'12 85 85 85 91 97 784 1,259 1,627 2,236 2,885 - - - 42 90 3,073 Shareholder's Equity Share Capital Reserves and Surplus Money received against share warrants Total equity capital 890 1,386 1,712 2,369 475 698 917 1,648 1,966 482 618 577 221 237 76 91 - 22 27 4,351 5,303 Liabilities Secured Loans Unsecured Loans Deferred Tax Liability Other Liabilities 42 60 Total Liabilities and Owner's Equity 1,889 2,762 3,281 - - - - 4,302 Assets Goodwill on consolidation Gross Block Less: Depreciation Net Fixed Assets Work-in-progress Investments Inventory Debtors Cash and Bank Balance Other Current Assets Loans and Advances Total Current Assets Other Assets Current Liabilities Provision Total Current Liabilities Net Current Assets Total Assets 1,526 2,096 2,609 3,429 138 192 314 496 749 1388 1905 2295 2933 3553 14 8 7 145 230 - - - - 963 278 446 619 754 169 330 283 357 406 11 16 24 31 167 0 0 0 0 0 183 239 260 241 298 1,520 1,521 1,522 139 260 181 140 1,518 1,519 86 113 98 114 106 92 121 143 192 205 220 257 321 1513 5303 449 825 967 1127 1889 2762 3281 4,351 (Rs mn) Four-S Research 11
  12. 12. 22 Apr 2013 Company Report: Venus Remedies Cash Flow Statement Cash Flow Statement Net Profit/(Loss) before Tax FY'08 FY'09 FY'10 FY'11 FY'12 433 477 464 526 509 50 52 125 182 113 4 2 2 0 0 Expenses Amortised Adjustment of excess mat Transferred to gen reserve 15 14 13 9 140 0 0 -15 53 38 Adjustment for FBT -2 -3 25 4 9 500 541 613 774 0 -275 -275 -148 -327 -352 -33 -72 -123 -73 -39 -2 -4 0 0 0 190 189 342 373 417 0 0 0 0 0 Operating Cash flow- A 190 189 342 373 417 Purchase/Sale of Fixed Assets (net) -743 -570 -512 -820 -873 403 6 0 -144 -77 1 0 0 0 0 Cash from Investing activities- B -338 -564 -512 -964 -951 Proceeds from Issue of Share Capital 0 0 0 48 6 proceed from share capital(share premium) -26 198 0 175 166 Proceeds from Long Term Borrowing( Net) 133 160 25 731 112 Proceeds from Short term Borrowing( Net) 22 20 153 -357 201 Depreciation Deferred Employee Compensations Operating Cash flow before Wcap Adjustments for increase /decrease in Current Assets Decrease / Increase in Current Liabilities/ Provisions Extraordinary Items Cash Generated from Operations Direct Taxes Paid Decrease in Capital Work-in-Progress (including capital advances) Interest received Proceeds from share warrants 48 Cash from Financing activities- C 129 379 178 598 533 Change in Cash= A+B+C -19 5 8 7 -2 Opening Balance 30 11 13 24 31 Closing Balance 11 16 21 31 29 (Rs mn) Four-S Research 12
  13. 13. 22 Apr 2013 Company Report: Venus Remedies Ratios Ratios FY'08 FY'09 FY'10 FY'11 FY'12 EPS 42.4 52.0 46.7 50.6 50.6 CEPS 22.5 22.4 40.4 40.9 44.8 2.0 2.5 1.0 1.3 1.4 P/E Ratio 9.1 2.9 5.5 4.0 3.4 EV/EBITDA 8.2 4.1 5.0 4.1 3.6 EV/Sales 2.0 1.0 1.2 1.0 0.9 EBITDA margin 23.8% 23.3% 23.2% 24.6% 25.1% Pretax margin 20.1% 17.7% 14.8% 14.5% 12.4% Net margin 16.6% 16.4% 12.6% 12.7% 11.5% Return on avg. Equity 21.7% 38.6% 25.5% 22.7% 17.3% Return on avg. Capital employed 18.1% 24.5% 20.4% 19.1% 16.3% Revenue growth 53.7% 24.7% 16.8% 15.6% 12.9% EBITDA growth 69.3% 22.0% 16.3% 22.6% 15.2% Net profit growth 52.5% 10.0% -2.7% 16.8% 1.7% Asset turnover 0.9 1.3 1.1 1.0 0.9 Working Cap turnover 6.2 4.2 3.5 3.3 3.3 Debtors turnover 16.3 10.8 10.3 11.3 11.3 Debtor Days 22.4 33.8 35.6 32.2 32 9.4 7.4 5.9 5.3 4.8 Inventory Days 38.8 49.2 61.9 69.0 76.5 Payables turnover 32.2 27.0 29.7 33.8 27.8 Payables Days 11.3 13.5 12.3 10.8 13.1 Current Ratio 1.4 1.7 1.5 1.7 1.5 Cash Ratio 0.2 0.1 0.1 0.1 0.1 Debt Equity 1.1 0.9 0.9 0.8 0.7 Leverage Ratio 2.1 2.0 1.9 1.8 1.7 Net Debt / EBITDA 1.8 2.1 2.0 2.1 2.1 Interest Coverage 9.7 6.6 4.3 3.8 2,8 DPS Valuation Ratios Profitability Growth Ratios Activity/Turnover Ratios Inventory turnover Liquidity Ratios Solvency Four-S Research 13
  14. 14. Company Report: Venus Remedies 22 Apr 2013 About Four-S Services Founded in 2002, Four-S Services is a financial boutique providing Research, Financial Consulting and Investment Banking services. We have executed more than 100+ mandates across diverse range of industries for Indian as well as global companies, investment firms and private equity and venture capital firms. Our clients value our focused, actionable advice which is based on deep domain expertise in Education, Financial Services, Media & Entertainment, Healthcare, Consumer Goods, Automotive, Energy, Logistics and Manufacturing. For further information on the company please visit www.four-s.com Disclaimer The information contained herein has been obtained from sources believed to be reliable but is not necessarily complete and its accuracy cannot be guaranteed. No representation, warranty, guarantee or undertaking, express or implied, is made as to the fairness, accuracy or completeness of any information, projections or opinions contained in this document. Four-S Services Pvt. Ltd. will not accept any liability whatsoever, with respect to the use of this document or its contents. This Company commissioned document has been distributed for information purposes only and does not constitute or form part of any offer or solicitation of any offer to buy or sell any securities. This document shall not form the basis of and should not be relied upon in connection with any contract or commitment whatsoever. This document is not to be reported or copied or made available to others. Four-S may from time to time solicit from, or perform consulting or other services for any company mentioned in this document. For further details/clarifications please contact: Alok Somwanshi Ajay Jindal Alok.somwanshi@four-s.com Ajay.jindal@four-s.com Tel: +91-22-42153659 Tel: +91-22-42153659 Four-S Research 14

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