Reports AMRUTANJAN HEALTH CARE Ltd - Nayan M Vala ...

RESEARCH
Amrutanjann Health
Care
Ltd
BUY
Key Indicators as
on 04/07/ /2012
Closing Price (Rs.)
EPS (Rs.)
P/E
BV per
Share (Rs.)
PB
Mkt Cap (Rs. Crore)
Beta
Mkt Cap/Sales
Mkt Cap/PBIDTA
Mkt Cap/PBDT
Mkt Cap/PAT
Mkt Cap/Cash Profit
PBDITA
Rs. in Crores
Face Value
Shares
Outstanding crores
Equity
Share capital (No.s)
Share holding (%)
Promoters
Public
FIIs
Others
SOURCE:CMIEE
823.88
46.666
17.65
331.711
2.48
240.8
0.71
2.09
13.50
15.62
18.95
16.69
17.83
10
244.76
29,23,0633
Mar-111
50.71
39.555
0.07
9.67
Investment Highlights:
Sales up by 55% since last 5 years
from 74.43cr to 115.02cr in Mar
2012. CAGR
of 11.49 % from 2008-
2012.
Dividends more than or equal to
150% are regularly paid from last 5
years.
Almost debt free due
to Cash
Balance.
EBIDTA and PAT margins are
ncreasing every year from 2010.
Promoters increased their holdings
from 48.61%
to 50.71%
in last six
Qtr.
Buy Back has been done thrice in
last 5 years, in 2009 the
offer price
was Rs 450,
in 2010 the
offer price
was Rs 550 per share and in 2011
it
was Rs 900.
Acquired ‘Fruitnik’ of
Drink Pvt Ltd in order
Siva’s Soft
to grow in
non
carbonated
beverages
industry. It contributed almost 14%
of sales in the year 2012.
Plans to relaunch new products by
December 2012 like hand sanitizer
(“NO GERMS”) & Sanitary Napkins
(“COMFY”)
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Sales UP by 55%
in last five years
post change in
leadership.
Investment Rationale:
Consistent increase in sales: Sales of the company have
increased by 55% in last 5 years post change in leadership. The
sales increased under the leadership of A Satish Kumar who came
into effect from 25 th June 2009. Before Change in director the
sales were growing at a very low rate.
EARLIER LEADERSHIP
(Rs. Cr) Mar ‘04 Mar ‘05 Mar‘06 Mar’07 Mar’08 CAGR (%)
Net sales 68.04 66.85 70.15 72.39 74.43 2.26
NEW LEADERSHIP
(Rs .Cr) Mar’08 Mar’09 Mar’10 Mar’11 Ma’ 12 CAGR (%)
Net sales 74.43 90.66 89.77 103.38 115.02 11.49
Dividend yield is
1.82%.
Negligible Debt as
Company has
substantial Cash
Balance
EBIDTA Margins (
excluding Other
income) have
increased from
11.47 % to 15.5%
More than 150% Dividend rate since 2008: The Company is
giving un-interrupted dividend since past 5 years
Percentage Mar 08 Mar 09 Mar 10 Mar 11 Mar 12
Div Rate 470 170 150 150 150
Borrowings: The Company increased their borrowings from
1.26cr to 26.63cr from Mar 2010 to Mar 2011. The borrowings
were made in order to acquire the ‘Fruitnik’ brand. Fruitnik had four
percent market share in Tamil Nadu. However the company is
effectively debt free due to its cash Balance of 14cr.
(Rs. Cr) Mar 10 Mar 11 Mar 12
Borrowings 1.26 26.63 18.91
Cash bal 25.04 19.88 14.72
EBIDTA and PAT Margins: Company’s EBITDA and PAT
margins are growing and have shown a good increase in 2012.
Particulars (Rs. Cr) Mar 09 Mar 10 Mar 11 Mar 12
Total Income 178.37 97.76 108.21 115.02
Net Sales 90.66 89.77 103.38 114.8
Ebitda ex OI 10.4 12.22 13.1 17.84
Ebidta margin ex OI (%) 11.47 13.61 12.67 15.50
PAT ex OI 5.15 3.82 5.85 8.4
PAT margin (%) 5.68 4.25 5.65 7.31
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Promoters
increased their
holdings from
48.61% to 50.71.
Promoters increase their holdings: Promoters increased their
shareholding from 48.61% to 50.71%.
51
50
49
48
47
48.31
48.61
% holding
50.39
50.71 50.71
Mar‐11 Jun‐11 Sep‐11 Dec‐11 Mar‐12
% holding
Buy Back done
thrice in last 5
years.
Acquiring Soft
drink called
Fruitnik which
contributed to
almost 14% of the
total sales in
2012.
Buy back of shares: Buy Back has been done thrice in last 5
years. In the year 2009 the offer price was Rs 450 and in year
2010 the offer price was Rs 550 per share and in year 2011 it was
Rs 900. Which is higher than C.M.P
(Rs. Cr) Mar 08 Mar 09 Mar 10 Mar 11 Mar 12
Paid up capital 3.2 3.1 3.03 3.03 2.92
Acquired Fruitnik: Amrutanjan Health Care Ltd has informed
BSE that the Company has entered into an agreement with M/s.
Siva's Soft Drink Pvt Ltd., Chennai to acquire their soft drink and
fruit based beverages business along with the brand, 'Fruitnik' for a
total consideration of Rs 26.20 Crores. Fruitnik contribution to total
sales was almost 14% in the year ended 2012.
Areas of concern:
The biggest risk facing the company today is price inflation of key raw materials. This is a
broader trend that is affecting all FMCG companies resulting in margin pressure.
The biggest threat going into FY 2011 is the intensive competition. Amrutanjan market share in
India is about 10% which is behind Vicks 16% and Zandu Balm 12%.
Upcoming products like Hand Sanitizer or Sanitary Napkins already have severe competition
and penetrating the same may be difficult.
Chemical business is a burden on the company as it continues to post losses since 5 years i.e.
March 2008 – March 2012.
Profit / Loss (Rs. Cr.) Mar-08 Mar-09 Mar-10 Mar-11 Mar-12
Chemical Segment (1.65) (1.28) (3.45) (2.81) (3.43)
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Company Profile:
Amrutanjan Health Care Ltd, more than a century old legendary Indian brand since
1893. The
company is engaged in manufacturing and marketing of ayurvedic and allopathic products. The
main product
of the company is Amrutanjan pain balm which contributes to 80 % of sales. It
has product offerings in the sectors of health care, food and medical care. The company has
two health care products
manufacturing units, one at Chennai and the
other at Hyderabad. It
also has a fine chemicals
division in Tamil Nadu.
Product Line
of Amrutanjan healthh care Ltd
Product Line
Pain
Management
Congestion
management
Products in
purity
Foods and
beverages
Comfy
Balm
Relief balm for
cough
No germs hand
sanitizer
(upcoming),
Fruitnik
Comfy sanitary
napkins
(upcoming)
Aromatic Balm
& Roll On
Cold inhaler &
mint
Decorn corn
caps
Kitchen
delights
Revenue Mix: The revenue mix shows that beverages have started to sell and is almost 14% of
total net saless in 2012.
0%
2012
6%
14%
OTC
Chemical
Beverages
80%
Others
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Quarterly Results – (Consolidated)
(Rs. Crore) Source: CMIE Dec 10 Mar 11 Jun 11 Sep 11 Dec 11 Mar 12
Total income 29.04 35.2 35.9 15.54 33.46 37.51
Net sales 28.04 34.23 34.34 14.66 32.37 36.36
Other income 1 0.97 1.56 0.88 1.09 1.15
Extra-ordinary income
Change in stock -1.06 1.9 0.07 -0.46 -0.01 1.5
Total Expenses 24.84 33.9 30.38 14.88 29.92 34.69
Cons. raw material 9.92 15.63 14.64 5.36 12.66 15.89
Salaries & wages 4.01 4.49 4.52 3.5 4.41 4.31
Other expenses 9.37 11.13 7.58 4.98 10.31 11.44
Extra-ordinary expenses
PBDIT 4.68 5.85 9.23 1.24 6.07 7.37
Depreciation 0.42 0.64 0.52 0.51 0.69 0.59
Interest 0.01 0.23 0.48 0.61 0.68
PBT 4.26 5.2 8.48 0.25 4.77 6.1
Tax 1.12 2 2.89 0.05 1.24 1.78
PAT 3.14 3.2 5.59 0.2 3.53 4.32
From NAYAN M. VALA SECURITIES PVT.LTD.RESEARCH
By Dushant Y. Hedau & Mayur R. Nakhwa
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NAYAN M. VALA SECURITIES PVT.LTD. Tel: (+91-22) 2610 5973 / 2610 5974
403-404, Cosmos Court, Fax. +91-22- 2612 4310
Above Waman Hari Pethe Jewellers E-Mail: research@nayanmvala.com
S. V. Road, Vile-Parle (West), Website: www.nayanmvala.com
Mumbai – 400056. INDIA
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