Sharon Bio-Medicine Limited is a Mumbai-based company that develops and sells pharmaceutical intermediates and active ingredients across various therapeutic areas, reporting a market capitalization of ₹386.38 crore and consolidated sales of ₹349.52 crore for Q2 2014. The Indian biotechnology sector is expanding rapidly, expected to grow to approximately USD 73.73 billion by 2020, with Sharon Bio positioned to benefit from USFDA and UKMHRA approvals, and strong demand in the agriculture sector. Current recommendations suggest buying shares due to potential revenue growth and normal sales, despite recent stock price corrections.

2. Company Details
Sharon Bio-Medicine Limited develops, manufactures, and sells intermediates,
active pharmaceutical ingredients (APIs), and finished dosage products in India
and internationally. The company provides its APIs in a range of therapeutic areas,
including anti depressant, anti hypertensive, anti fungal, anti diabetic, anti bacterial,
anti Alzheimer, anti psychotic, anti protozoal, anti diarrhoeal, and cardiovascular
areas, as well as veterinary, pro-kinetic, NSAID, and muscle relaxation areas. Its
intermediate product line targets various API/end uses, such as ketoconazole,
itraconazole, phase transfer catalyst, lansoprazole, trimetazidine, chemical
synthesis, glibenclamide, glimepiride, amlodipine besylate, and sertraline HCL. The
company also offers formulations in the therapeutic segments of oncology,
antibiotics, dermatology, liquid orals, soft gelatin capsules, and suppositories. In
addition, it provides clinical services, as well as various toxicology services related
to animals. Sharon Bio-Medicine Limited was incorporated in 1989 and is
headquartered in Mumbai, India.
The current market capitalisation stands at Rs 386.38 crore.The company has
reported a consolidated sales of Rs 349.52 crore and a Net Profit of Rs 20.54 crore
for the quarter ended Jun 2014.

3. Category
No. of
Shares
Percentage
Promoters 63,551,980 60.20
Other Companies 27,063,994 25.64
General Public 11,301,609 10.71
Foreign - OCB 1,500,000 1.42
Foreign Institutions 1,056,252 1.00
Others 731,191 0.69
Foreign - NRI 286,280 0.27
Foreign Industries 67,129 0.06
Financial Institutions 10,565 0.01
Market Cap (Rs Cr) – 386.38
Company P/E – 5.34
Industry P/E – 24.35
Book Value (Rs) – 24.95
Dividend (%) – 18%
EPS (TTM) – 6.85
Dividend Yield (%) – 0.98%
Face Value (Rs) -2
Share Holding Pattern Financial Details

4. Industry Details
The biotechnology sector of India is one of the most significant sectors in enhancing India's global profile as well as
contributing to the growth of the economy. This sector is directly or indirectly related to the health as well as the
agricultural sector of India.
India is among the top 12 biotech destinations in the world and is the largest producer of recombinant Hepatitis B
vaccine. Out of the top 10 biotech companies in India (by revenue), six focus their expertise in bio-pharmaceuticals
and four specialize in agri-biotech.
India had recently overtaken Canada to emerge as the fourth largest country to grow biotech or genetically modified
(GM) crops, as farmers here planted Bt cotton in about 11 million hectares. The global acreages under GM crops
increased to 175.2 million hectares in 2013, about five million hectares more than the previous year.
India also has no dearth of talent in this sector, as a number of institutions, both government and autonomous, provide
the necessary opportunities for the student seeking to obtain a degree in this sector. Also, the Government of India
has provided adequate scope to this sector by providing facilities for research and development (R&D) in the field of
biotechnology.
The Indian biotech industry holds about 2 per cent share of the global biotech industry. With the growth in the
customer base and more investments taking place in the biotech sector, the biotech industry is expected to grow to
around US$ 73.73 billion by the year 2020. The high demand for different biotech products has also opened up scope
for the foreign companies to set up bases and reap great profits.
The biotechnology industry in India, comprising about 400 companies, has grown three-fold in the last five years to
reach US$ 4 billion in FY 13. Growing at an average rate of about 20 per cent, India's biotech industry comprising
biopharmaceuticals, disservices, bio-agriculture, bio-industry and bio-informatics could reach the US$ 7 billion mark
by FY 15.

5. Balance Sheet
Jun '14 Jun '13 Jun '12 Jun '11 Jun '10
Sources Of Funds
Total Share Capital 21.11 10.56 10.56 10.56 10.56
Equity Share Capital 21.11 10.56 10.56 10.56 10.56
Share Application Money 80.56 54.75 54.75 54.75 8.01
Reserves 250.64 186.36 179.71 138.61 107.67
Revaluation Reserves 0.00 0.00 0.00 0.36 0.36
Networth 352.31 251.67 245.02 204.28 126.60
Secured Loans 558.59 441.37 316.71 257.09 211.44
Unsecured Loans 166.79 202.52 145.70 86.53 131.12
Total Debt 725.38 643.89 462.41 343.62 342.56
Total Liabilities 1,077.69 895.56 707.43 547.90 469.16
Application Of Funds
Gross Block 380.87 317.87 235.62 206.42 201.11
Less: Accum. Depreciation 55.85 46.33 34.29 25.57 17.34
Net Block 325.02 271.54 201.33 180.85 183.77
Capital Work in Progress 14.93 42.82 59.90 27.04 22.74
Investments 0.59 3.34 3.34 3.24 3.49
Inventories 322.45 260.24 196.22 155.21 116.67
Sundry Debtors 422.61 363.52 268.22 202.92 170.18
Cash and Bank Balance 12.34 6.32 6.31 1.20 1.30
Total Current Assets 757.40 630.08 470.75 359.33 288.15
Loans and Advances 71.53 32.11 46.15 22.53 12.32
Fixed Deposits 0.00 0.00 0.00 2.66 1.10
Total CA, Loans & Advances 828.93 662.19 516.90 384.52 301.57
Current Liabilities 73.79 69.94 62.19 41.10 36.75
Provisions 17.99 14.38 11.85 6.65 5.66
Total CL & Provisions 91.78 84.32 74.04 47.75 42.41
Net Current Assets 737.15 577.87 442.86 336.77 259.16
Total Assets 1,077.69 895.57 707.43 547.90 469.17
Book Value (Rs) 25.74 186.53 180.23 141.30 111.99

6. Profit and Loss Account
Jun '14 Jun '13 Jun '12 Jun '11 Jun '10
Income
Sales Turnover 1,324.79 1,073.52 804.14 626.81 522.98
Net Sales 1,324.79 1,073.52 804.14 626.81 522.98
Other Income 1.93 1.19 1.21 1.25 -0.46
Stock Adjustments 62.21 64.02 41.00 38.55 27.01
Total Income 1,388.93 1,138.73 846.35 666.61 549.53
Expenditure
Raw Materials 1,185.17 979.09 714.58 561.64 468.29
Power & Fuel Cost 8.77 8.27 7.27 6.76 5.47
Employee Cost 19.16 14.71 14.50 5.34 5.20
Other Manufacturing Expenses 0.00 0.00 2.56 10.78 7.64
Selling and Admin Expenses 0.00 0.00 0.00 6.60 6.55
Miscellaneous Expenses 16.40 14.44 10.11 1.86 1.22
Total Expenses 1,229.50 1,016.51 749.02 592.98 494.37
Operating Profit 157.50 121.03 96.12 72.38 55.62
PBDIT 159.43 122.22 97.33 73.63 55.16
Interest 58.63 43.06 34.26 26.81 21.00
PBDT 100.80 79.16 63.07 46.82 34.16
Depreciation 15.35 12.13 8.86 8.24 6.40
Other Written Off 0.00 0.00 0.00 0.10 0.13
Profit Before Tax 85.45 67.03 54.21 38.48 27.63
PBT (Post Extra-ord Items) 85.45 67.03 54.21 38.48 27.63
Tax 15.14 13.33 11.44 5.31 5.31
Reported Net Profit 70.32 53.71 42.77 33.18 22.33
Net P/L After Minority Interest & Share Of
Associates
70.32 53.71 42.81 33.18 22.33
Total Value Addition 44.33 37.42 34.44 31.33 26.07
Equity Dividend 3.80 1.58 0.00 1.90 1.58
Corporate Dividend Tax 0.65 0.27 0.00 0.32 0.27
Earning Per Share (Rs) 6.66 50.87 40.52 31.43 21.15
Book Value (Rs) 25.74 186.53 180.23 141.30 111.99

7. Dividend and Bonus History

8. Index Price Comparison

9. Company Forecast

10. PBIT – 10.77 v/s 10.21
ROCE – 13.4 v/s 12.3
Net Profit Margin – 5.29 v/s 4.98
Return on net worth – 26.43 v/s 27.94
Reserves – 250.64cr v/s 186.36cr
PAT – 70.32cr v/s 53.71cr
Total assets – 1077.69cr v/s 895.57cr
Net sales – 1324.79cr v/s 1073.52cr
Tax Paid – 15.14cr v/s 13.33cr
Days BSE NSE
30 53.19 53.18
50 57.95 57.90
150 61.19 61.21
200 57.15 57.15
Simple Moving AverageImportant Ratios

11. Recommendations
Buy Sharon Bio-Medicine Ltd. at current or lower market
levels
Reasons for the recommendations are :
License approval from USFDA and awaiting approval from UKMHRA will have a
substantial impact on revenue and profit of the company.
Growth in agriculture industry will have a huge positive impact on the demand of
SBML products.
No need for capital expenditure in short or medium term.
Big correction in the stock without even after the sales of the company being
normal.