Biocon Ltd.

Current price

488.80

Sector

Pharma

No of shares

200000000

52 week high

553.70

52 week low

402.45

BSE Sensex

29044.44

Nifty

8834.00

Average Volume

694466

BSE Code

532523

NSE Symbol

BIOCON

Company Overview

Biocon Limited was set up in the year 1978 as a joint venture between Biocon Biochemicals Limited of Ireland and an Indian entrepreneur, Kiran Mazumdar-Shaw. Biocon is a fully integrated biopharmaceutical company focused on biopharmaceuticals, customized research and clinical research. The Company has developed a robust drug pipeline and offers active pharmaceutical ingredients (APIs), including cardiovascular agents, anti- obesity agents, oral anti-diabetic agents, anti-inflammatory agents and digestive-aid enzymes.

Biocon's presence in the chronic disease segment in India is represented by over 80 brands spread across seven therapeutic segments Diabetology, Oncotherapeutic, Nephrology, Cardiology, Immunotherapy, Comprehensive Care and Bioproducts. Unlike most pharma companies that are chemical based, Biocon Limited has carved out its niche in the more complex biotechnology field. Over the decades, Biocon Ltd has successfully evolved into aned emerging global biopharma enterprise, serving its partners and customers in over 75 countries. The Company has strategic alliances with well known pharmaceutical companies including Mylan Inc, Amylin Pharmaceuticals, Inc, DuPont, Bristol-Myers Squibb, Endo Pharmaceuticals, IATRICa Inc, Neopharma, and Vaccinex, Inc. The Company also has commercial and marketing agreements with Pfizer and Ferozsons Laboratories Limited, and licensing agreement with Abraxis BioScience, Inc, as well as strategic collaboration for insulin products with Mylan, Inc.

Biocon Limited operates through five broad business verticals small molecules, research services, branded formulations, biosimilars and novel molecules. However, for reporting purpose, Biocon Ltd classifies its operations into two segments i.e. biopharma and research services. While biopharma comprises ~75% of overall sales, services account for the rest of the pie. Except for research services, all other business verticals have been grouped under the biopharma category. The Company’s brands include Herceptin, Enbrel, MabThera, Remicade, Lantus, Humalog and NovoLog. The current market capitalisation stands at Rs 9,450.00 crore.

Share Holding Pattern

Category

No. of Shares

Percentage

Promoters

80,847,694

40.42

Foreign Promoters

41,200,752

20.60

General Public

24,905,938

12.45

Foreign Institutions

21,460,044

10.73

Financial Institutions

9,815,657

4.91

Others

8,378,333

4.19

NBFC and Mutual Funds

6,930,213

3.47

Other Companies

5,291,631

2.65

Foreign - NRI

1,169,738

0.58

Financial Details
  • Market Cap (Rs Cr) – 6569.00

  • Company P/E (x) – 23.91

  • Industry P/E (x) – 30.10

  • Book Value (Rs) – 120.84

  • Price / BV (x) – 3.96

  • Dividend (%) – 100 %

  • EPS (TTM) – 20.01

  • Dividend Yield (%) – 1.05%

  • Face Value (Rs) – 5

Industry Overview

The Indian pharmaceuticals market is third largest in terms of volume and thirteen largest in terms of value, as per a pharmaceuticals sector analysis report by equity master. The Indian pharmaceutical industry is estimated to grow at 20 per cent compound annual growth rate (CAGR) over the next five years, as per India Ratings, a Fitch Group company. The domestic pharma market is expected to grow at 10-12 per cent in FY15 as compared to 9 per cent in FY14, as per a recent report from Centrum Broking. The domestic pharma growth rate was 11.9 per cent in October 2014, highlighted the report.

Biopharma is the largest sector contributing about 62 per cent of the total revenue, with revenue generation to the tune of over Rs 12,600 crore (US$ 2.03 billion). The bio-pharma sector comprises vaccines, therapeutics and diagnostics. Biopharma is the largest sector contributing about 62 per cent of the total revenue, with revenue generation to the tune of over Rs 12,600 crore (US$ 2.03 billion). The bio-pharma sector comprises vaccines, therapeutics and diagnostics.

Also, growing at an average rate of about 20 per cent, India's biotechnology industry comprising bio- pharmaceuticals, bio-services, bio-agriculture, bio-industry and bioinformatics may reach the US$ 7 billion mark by the end of FY15, according to an industry body. Biopharma is the largest sector contributing about 62 per cent of the total revenue, with revenue generation to the tune of over Rs 12,600 crore (US$ 2.03 billion). The bio-pharma sector comprises vaccines, therapeutics and diagnostics.

The Indian pharma market size is expected to grow to US$ 85 billion by 2020. The growth in Indian domestic market will be on back of increasing consumer spending, rapid urbanisation, raising healthcare insurance and so on. Going forward, better growth in domestic sales will depend on the ability of companies to align their product portfolio towards chronic therapies for diseases such as such as cardiovascular, anti-diabetes, anti- depressants and anti-cancers are on the rise.

Balance Sheet

 

Mar '14

Mar '13

Mar '12

Mar '11

Mar '10

Sources Of Funds

 

 

 

 

 

Total Share Capital

100.00

100.00

100.00

100.00

100.00

Equity Share Capital

100.00

100.00

100.00

100.00

100.00

Reserves

2,317.70

2,106.80

1,995.50

1,845.86

1,465.34

Networth

2,417.70

2,206.80

2,095.50

1,945.86

1,565.34

Secured Loans

81.50

28.20

5.60

74.06

89.68

Unsecured Loans

25.90

89.10

141.70

94.57

102.12

Total Debt

107.40

117.30

147.30

168.63

191.80

Total Liabilities

2,525.10

2,324.10

2,242.80

2,114.49

1,757.14

Application Of Funds

 

 

 

 

 

Gross Block

1,707.00

1,438.80

1,197.10

1,105.91

1,020.21

Less: Revaluation Reserves

0.00

0.00

0.90

0.95

0.95

Less: Accum. Depreciation

757.70

587.40

512.10

426.22

341.81

Net Block

949.30

851.40

684.10

678.74

677.45

Capital Work in Progress

101.80

51.20

113.80

103.29

58.33

Investments

493.20

619.00

657.00

485.82

418.64

Inventories

357.60

358.90

340.40

274.74

244.80

Sundry Debtors

494.60

427.00

445.00

418.10

383.64

Cash and Bank Balance

204.20

179.20

37.80

185.20

77.11

Total Current Assets

1,056.40

965.10

823.20

878.04

705.55

Loans and Advances

617.80

526.50

543.10

412.41

407.33

Fixed Deposits

0.00

0.00

2.20

25.03

0.01

Total CA, Loans & Advances

1,674.20

1,491.60

1,368.50

1,315.48

1,112.89

Current Liabilities

529.50

471.40

431.80

358.64

426.92

Provisions

163.90

217.70

148.80

110.19

83.25

Total CL & Provisions

693.40

689.10

580.60

468.83

510.17

Net Current Assets

980.80

802.50

787.90

846.65

602.72

Miscellaneous Expenses

0.00

0.00

0.00

0.00

0.00

Total Assets

2,525.10

2,324.10

2,242.80

2,114.50

1,757.14

Contingent Liabilities

781.50

447.10

204.40

154.90

261.74

Book Value (Rs)

120.89

110.34

104.78

97.29

78.27

Profit and Loss Account

 

Mar '14

Mar '13

Mar '12

Mar '11

Mar '10

Income

 

 

 

 

 

Sales Turnover

2,202.50

1,938.00

1,605.30

1,365.29

1,158.35

Excise Duty

0.00

0.00

50.00

38.96

29.90

Net Sales

2,202.50

1,938.00

1,555.30

1,326.33

1,128.45

Other Income

60.60

37.60

66.60

293.00

94.70

Stock Adjustments

-1.30

17.90

41.40

27.84

38.95

Total Income

2,261.80

1,993.50

1,663.30

1,647.17

1,262.10

Expenditure

 

 

 

 

 

Raw Materials

991.50

915.70

818.90

694.62

608.77

Power & Fuel Cost

161.50

142.40

97.70

81.63

67.25

Employee Cost

266.40

227.60

191.50

145.43

99.84

Other Manufacturing Expenses

0.00

0.00

19.00

16.29

12.32

Selling and Admin Expenses

0.00

0.00

120.40

86.62

105.37

Miscellaneous Expenses

308.50

264.50

15.70

12.38

10.60

Total Expenses

1,727.90

1,550.20

1,263.20

1,036.97

904.15

Operating Profit

473.30

405.70

333.50

317.20

263.25

PBDIT

533.90

443.30

400.10

610.20

357.95

Interest

0.90

1.20

1.70

2.38

1.99

PBDT

533.00

442.10

398.40

607.82

355.96

Depreciation

124.40

95.10

94.00

90.70

79.73

Profit Before Tax

408.60

347.00

304.40

517.12

276.23

Extra-ordinary items

5.50

0.00

0.00

0.00

0.00

PBT (Post Extra-ord Items)

414.10

347.00

304.40

517.12

276.23

Tax

84.20

71.30

48.90

57.87

27.87

Reported Net Profit

329.90

275.70

255.50

459.25

248.36

Total Value Addition

736.40

634.50

444.30

342.35

295.38

Equity Dividend

100.00

150.00

100.00

90.00

70.00

Corporate Dividend Tax

17.00

25.50

16.20

9.08

7.41

Per share data (annualised)

 

 

 

 

 

Shares in issue (lakhs)

2,000.00

2,000.00

2,000.00

2,000.00

2,000.00

Earning Per Share (Rs)

16.50

13.79

12.78

22.96

12.42

Equity Dividend (%)

100.00

150.00

100.00

90.00

70.00

Dividend and Bonus History

Index and Company Price Movement Comparison

Company Forecast

Technical Indicators

Name

Value

Action

RSI(14)

63.786

Buy

STOCH(9,6)

79.697

Buy

STOCHRSI(14)

71.830

Buy

MACD(12,26)

12.200

Buy

ADX(14)

36.438

Buy

Williams %R

-16.138

Overbought

CCI(14)

78.8891

Buy

ATR(14)

16.6250

High Volatility

Highs/Lows(14)

14.4714

Buy

Ultimate Oscillator

46.518

Sell

ROC

10.135

Buy

Bull/Bear Power(13)

27.7960

Buy

Important Ratios (YoY)
  • PBIT – 15.41 v/s 15.61

  • RoCE – 16.21 v/s 15.58

  • RoE – 14.40 v/s 18.90

  • Net Profit Margin – 14.57 v/s 13.85

  • Return on net worth – 13.64 v/s 12.49

  • D/E Ratio – 0.04 v/s 0.05

  • Interest Cover – 455.00 v/s 301.75

  • Current Ratio – 1.95 v/s 1.88

  • Reserves – 2317.70 cr v/s 2206.80 cr

  • PAT – 329.90 cr v/s 275.70 cr

  • Total assets – 2525.10 cr v/s 1938.00 cr

  • Net sales – 2202.50 cr v/s 1938.00 cr

  • Book Value – 120.89 cr v/s 110.34 cr

Simple Moving Average

Days

BSE

NSE

30

441.98

442.06

50

435.60

435.70

150

450.38

450.46

Investment Rationalize
  • Biocon is the India largest biological company with over 80 brands spread across seven therapeutic segments with 528 Patents and 329 Trade Marks for its products.

  • Company is the proven player in its most of the product in biotechnology segment which add on to the advantage of early entrance to the market along with good research and development back up for the pharma products.

  • It has products for Diabetology, Oncotherapeutic, Nephrology, Cardiology, Immunotherapy, Comprehensive Care and Bioproducts which will help the company to tap the demand and capitalize on the demand for these products segment too.

  • The debt of the company is being reduced by the management substantially along with its effective business model ensures quick and positive cash flow.

  • Revenue of the company is growing at CAGR of 14.3% in the past five years along with sustaining a Net Profit Margin of 14.7% and Reserves of the company stands at Rs.2317.70 crore.

  • Income from Biosimilars and CRAMS will help the company to increase the profits in a substantial manner along with the acquisitions of the company and launching of new products.

  • Getting of patents and incenses from Europe and America for its products along with future forecast of the health and diseases of people in India and abroad will add to the growth prospects of the company.

  • Collaborations with worlds leading pharma players from more than 75 nations will help the company to add the companies advantage over its competitors along with its India centric approach will help the company to reduce external interventions.

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