3 February 2015
3QFY15 Results Update | Sector: Healthcare
Lupin
BSE SENSEX
29,000
Bloomberg
Equity Shares (m)
52-Week Range (INR)
1, 6, 12 Rel.Per (%)
Avg Val/Vol ‘000
Free float
S&P CNX
8,757
LPC IN
447.5
1606/885
4/19/24
675/578
53.3%
CMP: INR1,545
TP: INR1,875 (+21%)
Buy
Stronger margins compensate for topline miss - Outlook robust
Lupin’s (LPC) 3Q PAT at INR 6b (+26% YoY) beat est. solely due to fx gains (INR 169m)
& lower taxes (28% vs 31% est.) as operational results were in line. Sales at INR 31.4b
(+5% YoY, 5% miss) disappointed on fewer new launches in US. However, EBITDA at
INR 8.5b was largely in line on continued margin surprise (27% vs 26.3% est.).
Revenue momentum hurt by weaker US/Japan sales:
High base of last year (niche
launches) and fewer new launches hurt US growth (+4% YoY, 45% of sales). Pick-up in
Antara and favorable flu-season aided branded sales (10% of US sales). India growth
remains robust (+14%) while Japan growth (down 8% YoY, 11% of sales) was hurt by
fx movement. RoW growth at 24% was buoyed by inclusion of Mexican acquisition.
EBITDA margins restrained by fx impact:
3Q margins at 27% (+240bp YoY) included fx
translational losses (90-100bp impact), adjusted for which margins were much higher
than 26.3% est. Lower than expected competition in key US generic launches like
gZymaxid, gFortamed, gTrizivir as well as inclusion of high margin Mexican acquisition
boosted gross margins (+490bp YoY). We expect EBITDA margins to sustain at 28-30%,
despite higher R&D spend led by high margin US launches & strong domestic growth.
Earnings call takeaways:
(a) Expect four new US generic launches in 4Q, including
gNexium, gWelchol to aid revenue traction (15-20 launches in FY16), (b) Unlikely to
see generic player in Suprax (USD 55m brand, 6% of PAT) for 1 year at least, (c) Aim
to achieve USD 5b sales by FY18 of which USD 1b driven by acquisitions, (d) To file
inhaler products in US by FY17 (clinical trials in FY16) and enter alongside 2
nd
generic
entrant by FY18-19, (e) R&D spend to increase up to 10% of sales (8.3% now).
Valuation and view:
We tweak our forecasts mainly to factor lower taxes and expect
LPC to register 25% core EPS CAGR (ex one-offs) over FY15-17E, backed by 19% growth
in revenues. We expect improved pace of niche US generic launches, incremental
growth from new brands (Locoid/Alinia) and sustained momentum in India (18%
CAGR) would be the key growth drivers. We reiterate
Buy
with a revised target price
of INR1, 875 (24x FY17E EPS, in line with large peers).
M.Cap. (INR b)/(USD b) 689.2/11.0
Financials & Valuation (INR b)
Y/E Mar
Sales
EBITDA
Rep. PAT
Adj. EPS
EPS Gr. (%)
BV/Sh.INR
RoE (%)
RoCE (%)
P/E (x)
P/BV (x)
2015E 2016E 2017E
129.2
35.7
24.4
49.5
60.6
200.5
27.9
40.9
31.1
7.7
153.5
44.7
28.5
63.1
27.3
254.7
27.7
38.9
24.4
6.0
182.5
54.8
35.4
78.0
23.7
323.0
27.0
38.4
19.7
4.8
Estimate change
TP change
Rating change
+2%
Arvind Bothra(Arvind.Bothra@MotilalOswal.com);+91
22 3982 5584
Amey Chalke
(Amey.Chalke@MotilalOswal.com);+91 22 3982 5423
Investors are advised to refer through disclosures made at the end of the Research Report.
Motilal Oswal research is available on
www.motilaloswal.com/Institutional-Equities,
Bloomberg, Thomson Reuters, Factset and S&P Capital.

Lupin
3Q Result analysis
Exhibit 1:
Quarterly Snapshot (Revenue mix)
(INR m)
Revenue split
US
Branded
Generic
India
Japan
Europe
ROW
APIs
Total revenues
3QFY14
13,567
1,492
12,075
6,504
3,720
661
2,405
2,973
29,830
2QFY15
12,716
1,272
11,444
7,990
3,459
876
2,944
3,183
31,168
3QFY15
14,043
1,364
12,679
7,438
3,422
805
2,983
2,758
31,449
%YoY
3.5
(8.6)
5.0
14.4
(8.0)
21.8
24.0
(7.2)
5.4
%QoQ Comments
10.4
7.3 Generic competition in Antara hurt YoY growth
10.8
(6.9)
(1.1) Constant currency growth in Japan at 4% (Kyowa grew 9% in JPY)
(8.1)
1.3 Includes Lab Grin (Mexico) acquisition impact for full quarter
Higher captive utilization hurt growth. Likely at 6-7% annualized
(13.4)
basis.
Overall revenues were 5% below estimates, mainly on weaker
0.9
US/Japan sales
Exhibit 2:
Quarterly Profit and Loss statement
(INR m)
Total revenues
Cost of revenues
Gross profit
Gross margin (%)
Staff cost
% of Total Revenues
Other expense
% of Total Revenues
R&D expense
% of Total Revenues
EBITDA
EBITDA margin (%)
Depreciation
% of Total Revenues
EBIT
Interest cost
Other income (net)
PBT
Income tax
Effective tax rate (%)
Minority interest
Net Profit - reported
3QFY14
29,830
11,209
18,621
62.4
3,787
12.7
4,780
16.0
2,710.0
9.1
7,343
24.6
637
2.1
6,706
42
714
7,379
2,542
34.4
76.1
4,761
2QFY15
31,168
10,698
20,470
65.7
4,389
14.1
5,474
17.6
2,848.0
9.1
7,759
24.9
1,087
3.5
6,673
21
1,668
8,320
1,926
23.1
93.7
6,300
3QFY15
31,449
10,236
21,214
67.5
4,159
13.2
5,948
18.9
2,604.9
8.3
8,502
27.0
1,103
3.5
7,399
26
1,161
8,534
2,387
28.0
132.8
6,015
%YoY
5.4
(8.7)
13.9
503 bp
9.8
53 bp
24.4
289 bp
(3.9)
(80)bp
15.8
242 bp
73.2
64.3
10.3
(36.5)
62.6
15.6
(6.1)
(648)bp
74.5
26.3
%QoQ
0.9
(4.3)
3.6
178 bp
(5.2)
(86)bp
8.7
135 bp
(8.5)
(85)bp
9.6
214 bp
1.5
0.6
10.9
23.9
(30.4)
2.6
23.9
482 bp
41.7
(4.5)
Net profits were ahead (6% beat) thanks to lower taxes, fx
gain
Effective tax rate of 30-31% for full year
Other income includes forex gain of INR640m
Likely to increase as niche US generic products enter
clinical trials
Can rise up to 10% of sales by FY17E (upper limit)
EBITDA was marginally below expectations despite 5%
sales miss
Margins were higher than 26.3% est., partly restricted by
fx losses
Includes MTM forex losses pertaining to restatement (B/S)
Aided by better product mix and Mexico acquisition
Sequential decline due to ESOP cost in 2Q
Comments for 3QFY15
High base of last year (gCymbalta) affected YoY
comparison
3 February 2015
2

Lupin
Revenues lag expectations on US growth moderation
Lupin's 3QFY15 revenues grew 5% YoY to INR31.5b (v/s est. INR33.0b). Revenue
growth was impacted by weaker performance in US and Japan. US generics growth
of 5% YoY was affected by higher base of last year (gCymbalta, gTrizivir launched last
year) as well as fewer new launches. Branded US sales registered 9% YoY decline to
INR1.4b (10% of US sales) with impact of Antara’s genericisation. India recorded a
14.4% growth (in line) while Japan sales declined 8% YoY (v/s est. 12% growth)
mainly due to adverse currency movement (constant currency growth of 4% YoY).
ROW & South Africa grew 24% YoY (v/s est. 15% growth) thanks to addition of Lab
Grin (Mexico) operations for full quarter.
Higher margins compensate for top-line miss
EBITDA grew 16% YoY to INR8.5b (v/s estimate of INR8.7b, 2% miss), much ahead of
topline growth thanks to 240bp expansion in EBITDA margins (YoY). EBITDA margin
beat (27% vs 26.3% est.) was led by higher gross margins at 67.5% compared to
62.4% in 3QFY14. This was driven by a) improved business mix (lower API sales), b)
higher contribution from gCelebrex (authorized generic, USD 2.2b brand sales, 3
players) in US and c) inclusion of high margin Mexican acquisition for full quarter.
Net profit at INR 6b grew significantly faster at 26% YoY (6% beat), boosted by lower
tax rate at 28% (v/s est. 31%) and net forex gain of INR169m during the quarter.
Exhibit 3: Revenue growth lagged expectations
Sales (INR b)
44
29
38
35
18
9
22
22
25
25
24
26
30
31
33
31
21
20
YoY Growth (%)
36
18
5
4
5
6
6
5
6
7
8
11
8
9
Exhibit 4: EBITDA margins surprised positively though
EBITDA (INR b)
23
24
22
24
EBITDA margin (%)
25
26
32
25
27
31
19
20
Source: Company, MOSL
Source: Company, MOSL
Hiugher pick up in new launches to accelerate growth in US
US Generic business (40% of sales):
LPC continued to register low single digit
growth in US in the last two consecutive quarters owing to loss of exclusivity in
launches like gCymbalta and gNiaspan. LPC had launched gYaz in 2QFY15,
however the revenue ramp-up has been slower. Only one product was launched
during the quarter, gCelebrex which contributed meaningfully to profitability
(despite launch in Dec’14) due to lower competition (3 players).
However, the management expects four new launches in 4QFY15 to help
improve revenue momentum in US, including some high impact launches like
gNexium (limited players, potential USD 40m revenue opportunity) and
gWelchol (both capsules/suspension, LPC has FTF). LPC is also expected to
launch 15-20 products annually over FY16-17, which will support 20-24% growth
momentum over FY16-17E.
3 February 2015
3

Lupin
US branded business (4% of sales):
Impact of genericasation in Antara brand
continued to impact US brand sales, which now account for 10% of US sales (vs
15-20% earlier).
However, recently launched chewable Suprax tablets (chewable) and low-dose
Antara are gaining traction (likely to recoup some of lost sales). Newly acquired
Alinia brand has also ramped up during the quarter, albeit on a small base. The
company is also expected to launch a differentiated version of Aerochambers
(mdi inhaler) in February 2015 which would help reinvigorate US brand sales.
Overall, contribution from branded business was ~4% (of total sales) in 3QFY15.
LPC continues to look at expanding its brand portfolio in US and is eyeing mid-
sized acquisitions (sub USD100m) to achieve the same.
Exhibit 5: US revenues: Generic business continues to drive growth
US Generics (USD m)
US Branded (USD m)
27
214
17
15
246
195
37
111
32
112
47
145
30
181
20
154
17
149
24
195
22
195
Source: Company, MOSL
India business maintains strong momentum (~24% of sales)
Domestic formulations business continued to outpace industry growth at 14.4%
YoY, clocking revenues of INR 7.4b. Growth YTD has been much higher at 21%.
The management expects LPC to outpace the industry and has guided for 18-
20% YoY growth in FY15E. We have factored in 18%/18.5% growth in
FY16E/17E.
LPC currently has 5400 MRs and does not plan to increase field strength
meaningfully as the focus would remain on increasing productivity levels.
Fx headwind constrain Japan growth (~12% of sales)
Growth in Japan was muted, affected by strong JPY depreciation.
Despite impact of bi-annual price erosion (~10%), Kyowa sales (78% of Japan
sales) grew 9% YoY to JPY 4.9b. However in INR terms, revenues declined by 4%
YoY (INR2.7b).
I’rom (22% of Japan sales) reported a 9% YoY decline in JPY terms due to
continued restructuring and impact of ~10% price erosion (bi-annual). Contract
business accounts for 30% of I’rom business. Management indicated that I’rom
is likely to see muted top line growth for FY15/16. However, profitability is
expected to improve from 1HFY16 led by cost rationalization efforts.
Exhibit 7: Japan – currency headwinds impact growth
Exhibit 6: Domestic Formulations - Growth recovering
3 February 2015
4

Lupin
India Sales (INR b)
43
25
18
YoY Growth (%)
29
1.1
14
7
2.3
2.3
1.0
Kyowa ex I'rom (INR b)
1.1
0.7
2.6
2.0
0.8
2.1
0.9
0.8
2.8
I'rom (INR b)
0.8
0.8
0.7
0.8
14
6
6
-5
6
9
7
14
2
7
6
8
20
6
6
8
2.3
2.4
2.6
2.7
2.7
Source: MOSL, Company
Source: MOSL, Company
Other takeaways from earnings call:
LPC aspires to achieve USD 5b sales by FY18-end, implying 32% revenue CAGR.
Almost 20% of the targeted sales or USD 1b is likely to be added through
acquisitions (deal size of USD 200-300m) over the next three years. This
translates to 24% revenue CAGR for the continuing business, much higher than
19% assumed in our forecasts.
R&D expenses:
Expect R&D spend is likely to increase further as some of
complex US generic products like respiratory products (inhalers, nasal spray)
enter clinical trial phase in coming years (in FY16). The company is expected to
maintain EBITDA margins at least at current levels despite 150-200bp increase in
R&D spend over the next 2-3 years (to 10% of revenues).
Do not foresee generic competition in Suprax for at least another year.
Suprax
accounts for ~6% of company’s profitability and has been subject to generic
competition for some time now.
To file inhaler products in US by FY17 (clinical trials in FY16) and enter alongside
2
nd
generic entrant by FY18-19.
Effective tax rates likely to be at 30-31%, lower than earlier guidance of 32-33%.
3 February 2015
5

Lupin
Operating metrics
Exhibit 8: Key operating metrics
4QFY12 1QFY13 2QFY13 3QFY13 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15 3QFY15
Revenue Mix (%)
US
India
Japan
Europe
ROW
APIs
Revenue Gr. (%)
US
India
Japan
Europe
ROW
APIs
As % of sales
Raw material
Staff cost
R&D cost
Other expenses
Tax Rate
Margins (%)
Gross Margins
EBITDA Margins
EBIT Margins
PAT margins
59.5
17.6
16.5
8.3
63.1
19.1
18.7
12.6
60.3
20.3
20.2
13.0
62.1
23.1
22.8
13.6
64.4
24.1
21.1
16.1
63.9
22.1
21.8
16.6
68.0
23.7
25.9
15.4
62.4
24.6
24.9
16.0
67.9
26.5
26.5
18.1
66.3
32.2
31.5
65.7
24.9
24.0
67.5
27.0
27.2
40.5
14.3
-
27.5
45.5
36.9
13.6
8.0
22.4
29.8
39.7
13.4
4.2
22.4
32.6
37.9
12.8
9.7
16.5
38.1
35.6
13.0
7.9
19.4
20.7
36.1
13.6
8.1
20.2
34.9
32.0
14.0
8.3
22.1
38.2
37.6
12.7
9.1
16.0
34.4
32.1
12.8
8.0
20.6
29.2
33.7
12.5
7.4
14.1
39.0
34.3
14.1
9.1
17.6
23.1
32.5
13.2
8.3
18.9
28.0
40.9
21.0
14.3
2.4
8.5
12.9
27.9
32.1
19.9
66.4
10.5
61.3
(6.1)
36.2
28.0
15.0
2.1
8.3
10.4
44.8
62.7
25.0
99.8
13.7
36.3
10.2
34.9
27.1
14.7
2.8
9.8
10.7
29.3
41.6
18.4
85.4
35.8
37.5
21.1
42.1
23.1
14.8
2.4
7.9
9.5
38.5
67.9
13.9
48.2
(7.1)
20.1
18.8
45.2
22.3
10.8
2.6
9.5
9.6
35.6
49.0
43.0
2.2
45.4
50.7
0.2
41.4
24.3
12.1
4.0
8.1
10.0
9.1
24.9
(5.1)
(12.2)
106.3
7.1
4.8
39.3
25.2
11.8
2.8
10.0
10.9
17.5
32.4
9.4
(6.3)
18.4
20.2
19.6
45.5
21.8
12.5
2.2
8.1
10.0
21.0
30.6
13.9
1.7
10.5
23.2
26.3
48.2
18.9
10.5
2.6
10.2
9.5
20.3
28.2
1.8
16.9
20.5
30.0
10.0
48.9
23.2
10.4
2.1
6.5
8.9
35.7
60.3
29.2
16.8
(29.3)
8.8
20.4
40.8
25.6
11.1
2.8
9.4
10.2
18.4
22.9
20.4
11.8
18.2
11.7
11.2
44.7
23.7
10.9
2.6
9.5
8.8
5.4
3.5
14.4
(8.0)
21.8
24.0
(7.2)
19.0
20.2
19.1
Source: Company; MOSL
3 February 2015
6

Lupin
Valuation and view
Lupin has consistently re-rated over the last five years following consistent
earnings performance, improvement in Balance Sheet health and return ratios. We
believe that it is likely to remain at the higher end of its P/E band as we remain
convinced on its execution ability, driving further earnings upgrades.
We value Lupin at 24x FY17E EPS, at par large cap peers (1 year forward P/E) which
is justified noting:
Superior earnings growth of 25% (vs 22% for peers)
High return ratios (FY15E: RoE of 28%, RoCE of 40%)
Strong Balance Sheet (Net cash surplus of Rs 2bn)
Key catalysts to drive stock performance over medium term are:
Potential M&A to expand reach in RoW markets (Eastern Europe, Latam).
Rebuilding of US branded business, with scale-up of new brands Alinia and
Locoid as well as product extensions for Suprax (life cycle management).
Niche US generic launches like g Welchol, gNexium, gGlumetza, etc in the next
4-6 quarters.
We believe that the following factors pose risks to our thesis:
Regulatory delays affecting key US launches.
Potential generic competition in Suprax suspension (USD55m+ brand).
Slower than expected turnaround of Japan business (I’rom acquisition), delaying
margin improvement.
Exhibit 9: P/E valuation band (10 years)
37.0
25.0
18.0
13.0
1.0
17.5
7.0
PE (x)
Median(x)
Peak(x)
Min(x)
Avg(x)
Exhibit 10: Higher premium relative to Sensex
80
27.9
24.7
13.3
0
Lupin PE Relative to Sensex PE (%)
LPA (%)
56.5
-80
Source: Company, MOSL
Source: Company, MOSL
3 February 2015
7

Lupin
Corporate profile
Company description
Lupin is amongst the larger pharma companies that
is actively targeting the regulated generics markets.
Historically very strong in the anti-TB segment, it has
over the years built up expertise in fermentation-
based products and segments like cephalosporins,
prils and statins. Lupin is now a fully integrated
company, with manufacturing capabilities in APIs
and formulations and a direct marketing presence in
the target markets.
Exhibit 11: Stock Vs Index rebased
1,675
1,500
1,325
1,150
975
800
Feb-14
May-14
Aug-14
Nov-14
Feb-15
Lupin
Sensex - Rebased
Exhibit 12: Shareholding pattern (%)
Dec-14
Promoter
DII
FII
Others
46.7
11.0
31.8
10.6
Sep-14
46.7
11.0
31.7
10.6
Dec-13
46.8
12.1
31.5
9.7
Exhibit 13: Top holders
Holder Name
Genesis Indian Investment Co Ltd
ICICI Prudential Life Insurance Company
National Westminister Bank Plc
Jhunjhunwala Rakesh Radheshyam
Aberdeen Global Indian Equity
% Holding
2.7
1.8
1.6
1.6
1.1
Note: FII Includes depository receipts
Exhibit 14:
Top management
Name
Dr. Desh Bandhu Gupta
Dr. Kamal K Sharma
Mr. Nilesh Gupta
Ms. Vinita Gupta
Ms. M D Gupta
Designation
Chairman
Vice Chairman
Managing Director
CEO, Lupin Limited
Executive Director
Exhibit 15: Board of director
Name
Desh Bandhu Gupta
Kamal K Sharma
Nilesh Gupta
Vinita Gupta
R A Shah*
*Independent Director
Name
K U Mada*
Vijay Kelkar*
Richard Zahn*
Dileep C Choksi*
M D Gupta
Exhibit 16: Auditors
Name
Deloitte Haskins & Sells LLP
S D Shenoy
Ernst & Young LLP
Type
Statutory
Cost Auditor
Internal
Exhibit 17: MOSL forecast v/s consensus
EPS (INR)
FY15
FY16
FY17
MOSL
forecast
49.5
63.1
78.0
Consensus
forecast
52.8
62.7
73.5
Variation
(%)
-6.3
0.6
6.1
3 February 2015
8

Lupin
Story in charts
Exhibit 18: Revenue mix in FY14
Exhibit 19: Healthy revenue growth outlook on
expanded base
Formulations (INR b)
API (INR b)
15
12
9
60
9
85
11
13
5
31
5
40
9
49
100
117
140
168
FY09 FY10 FY11 FY12 FY13 FY14 FY15E FY16E FY17E
Source: Company, MOSL
Source: Company, MOSL
Exhibit 20: US business to be driven by strong
ANDA pipeline
Generic sales (USD m)
Branded Sales (USD m)
95
82
145
127
221
FY10
133
310
FY11
143
87
110
Exhibit 21: Forecast sustained improvement in margins
EBITDA (INR m)
EBITDA margins (%)
27.6
29.1
30.0
18.0
17.8
17.3
20.3
24.2
367
FY12
547
FY13
712
FY14
855
1,052
1,293
8,867 10,068 11,821
FY10
FY11
FY12
19,981
FY13
26,505
35,688
44,652
54,776
FY15E FY16E FY17E
Source: Company, MOSL
FY14
FY15E FY16E FY17E
Source: Company, MOSL
Exhibit 22: Expect strong EPS CAGR of 25% over FY15-17E
Core EPS (INR/ share)
1
5
10
11
FY09
17
FY10
19
FY11
2
18
FY12
6
23
FY13
31
50
63
78
Exhibit 23: Higher tax outflow constrained PAT margins
PBT margin (%)
26
18
14
18
15
18
13
21
17
19
19
19
PAT margin (%)
28
27
29
14
FY14 FY15E FY16E FY17E
Source: Company, MOSL
FY10
FY11
FY12
FY13
FY14
FY15E FY16E FY17E
Source: Company, MOSL
3 February 2015
9

Lupin
Exhibit 24: Industry leading return ratios
37.4
34.6
29.6
21.7
22.5
20.0
13.7
22.8
23.4
26.8
27.7
27.0
90
58
Exhibit 25: Rich ANDA pipeline
30.5
33.7
Cummulative ANDAs filed
173
127
86
148
100
109
98
93
95
Pending ANDAs
176
192
203
RoE (%)
ROIC (%)
27.9
18.3
18.3
18.4
FY09
FY10
FY11
FY12
FY13
FY14 FY15E FY16E FY17E
Source: Company, MOSL
FY09
FY10
FY11
FY12
FY13
FY14
FY15
Source: Company, MOSL
Exhibit 26: Tricor market share (%) sustained at ~20% levels
TEVA USA
MYLAN
40.0
30.0
20.0
10.0
0.0
Jun-14
Jul-14
Aug-14
Sep-14
Oct-14
Nov-14
Dec-14
Jan-15
29.2
24.6
19.6
15.4
9.7
ABBVIE US LLC
PERRIGO CO
LUPIN PHARMA
Source: Bloomberg, MOSL
Exhibit 27: Trizivir market share (%) – LPC benefits from low competition
100
75
50
25
0
Jun-14
Jul-14
Aug-14
Sep-14
Oct-14
Nov-14
Dec-14
Jan-15
24.1
LUPIN PHARMA
VIIV HEALTHCARE
75.5
Source: Bloomberg, MOSL
3 February 2015
10

Lupin
Financials and valuations
Key assumption
Segment growth
US
India
Japan
Europe
ROW
API
Total Sales
Expenses
R&D Expenses (%)
Cost of sales (%)
EBITDA Margin (%)
2010
34.3
14.5
16.9
32.0
80.6
12.0
27.5
7.3
40.4
20.2
2011
27.4
22.2
20.9
35.2
43.5
65.3
26.9
8.3
38.5
20.2
2012
15.2
15.0
33.0
(14.0)
30.0
(1.1)
21.1
7.4
36.8
20.4
2013
35.7
8.5
33.1
4.3
36.0
11.9
36.0
7.4
36.8
23.5
2014
15.4
(5.6)
(11.1)
22.1
21.3
17.3
17.2
8.2
33.8
26.6
2015E
17.9
19.3
6.5
3.0
16.3
9.0
16.8
8.3
33.1
28.7
2016E
21.7
16.2
10.0
15.0
21.5
10.6
18.6
8.5
33.0
30.0
2017E
22.4
18.5
12.0
15.0
20.0
9.0
18.9
8.5
32.5
30.9
Income Statement
Y/E March
Net Sales
Change (%)
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income - Rec.
PBT before EO item
EO Expense/(Income)
PBT after EO item
Tax
Tax Rate (%)
Less: Minority Interest
Reported PAT
PAT Adj for EO items
Change (%)
Margin (%)
2010
47,736
26.4
8,867
18.6
1,239
7,628
385
1,114
8,356
0
8,356
1,360
16.3
112
6,885
6,885
36.3
14.4
2011
56,478
18.3
10,068
17.8
1,712
8,356
345
1,934
9,944
0
9,944
1,149
11.6
148
8,646
8,646
25.6
15.3
2012
68,204
20.8
11,821
17.3
2,275
9,546
355
2,768
11,960
0
11,960
3,086
25.8
196
8,678
7,917
-8.4
11.6
2013
93,694
37.4
19,981
21.3
3,322
16,659
410
2,997
19,246
0
19,246
5,842
30.4
263
13,142
10,347
30.7
11.0
2014
109,343
16.7
26,505
24.2
2,610
23,895
267
3,688
27,317
-1,000
28,317
9,622
34.0
331
18,364
13,831
33.7
12.6
2015E
129,158
18.1
35,688
27.6
4,403
31,285
99
3,740
34,926
-847
35,773
11,005
30.8
376
24,392
22,246
60.8
17.2
(INR Million)
2016E
153,508
18.9
44,652
29.1
4,866
39,787
120
2,276
41,943
0
41,943
13,002
31.0
400
28,541
28,316
27.3
18.4
2017E
182,488
18.9
54,776
30.0
5,230
49,546
120
2,601
52,027
0
52,027
16,128
31.0
500
35,399
35,033
23.7
19.2
3 February 2015
11

Lupin
Financials and valuations
Consolidated Balance Sheet
Y/E March
Equity Share Capital
Total Reserves
Net Worth
Minority Interest
Deferred liabilities
Total Loans
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Investments
Goodwill & Intangibles
Curr. Assets
Inventory
Account Receivables
Cash and Bank Balance
Others
Curr. Liability & Prov.
Account Payables
Provisions
Net Current Assets
Appl. of Funds
E: MOSL Estimates
(INR Million)
2010
800
24,789
25,589
344
1,435
11,399
38,766
22,937
7,072
15,865
3,579
264
3,197
27,754
9,715
11,266
2,015
4,759
11,893
9,649
2,243
15,862
38,767
2011
892
31,919
32,811
515
1,412
11,463
46,200
25,835
9,075
16,760
4,904
32
3,810
35,359
12,000
12,556
4,202
6,601
14,663
11,941
2,723
20,696
46,200
2012
893
39,236
40,129
723
1,442
15,557
57,852
36,274
14,422
21,852
4,437
28
5,644
47,393
17,327
17,800
4,025
8,241
21,503
17,565
3,939
25,889
57,851
2013
895
51,147
52,042
595
1,632
10,240
64,509
41,138
16,840
24,298
3,107
21
5,704
55,305
19,489
21,870
4,349
9,597
23,926
19,241
4,684
31,379
64,509
2014
897
68,419
69,316
669
1,779
5,992
77,756
45,638
19,283
26,355
3,041
1,785
7,202
62,970
21,295
24,641
7,975
9,060
23,597
18,818
4,779
39,374
77,756
2015E
898
89,133
90,031
1,045
1,779
5,992
98,847
52,158
23,686
28,472
1,771
1,785
7,202
84,990
25,427
34,335
16,759
8,469
25,371
19,559
5,812
59,618
98,847
2016E
898
113,471
114,369
1,445
1,779
5,992
123,585
60,043
28,552
31,492
1,135
1,785
7,202
111,550
30,021
40,706
32,022
8,801
29,578
23,093
6,485
81,972
123,585
2017E
898
144,142
145,040
1,945
1,779
5,992
154,755
67,611
33,782
33,829
818
1,785
7,202
145,456
35,114
48,344
52,833
9,166
34,334
27,011
7,323
111,123
154,755
Ratios
Y/E March
EPS (Fully Diluted)
Cash EPS (Fully Diluted)
BV/Share
DPS
Payout (%)
Valuation (x)
P/E (Fully Diluted)
Cash P/E (Fully Diluted)
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
RoE
RoCE
Working Capital Ratios
Debtor (Days)
Inventory (Days)
Leverage Ratio
Debt/Equity (x)
2010
17.2
20.3
64.0
3.2
21.5
2011
19.4
23.2
73.5
3.0
18.2
79.5
66.3
20.9
12.3
69.2
0.2
34.6
27.6
86
74
2.3
29.6
25.3
81
78
2.4
2012
17.7
22.8
89.9
3.4
20.5
86.9
67.5
17.1
10.3
59.3
0.2
21.7
24.6
95
93
2.2
2013
23.1
30.5
116.3
4.0
15.9
66.6
50.4
13.2
7.4
34.8
0.3
22.5
33.3
85
76
2.3
2014
30.8
36.7
154.6
6.0
16.0
49.9
42.0
10.0
6.3
25.9
0.4
22.8
40.1
82
71
2.7
2015E
49.5
59.4
200.5
7.0
15.1
31.1
25.9
7.7
5.3
19.0
0.5
27.9
40.9
97
72
3.3
2016E
63.1
73.9
254.7
8.0
14.7
24.4
20.8
6.0
4.3
14.9
0.5
27.7
38.9
97
71
3.8
2017E
78.0
89.7
323.0
9.0
13.4
19.7
17.2
4.8
3.5
11.7
0.6
27.0
38.4
97
70
4.2
3 February 2015
12

Lupin
Cash Flow Statement
Y/E March
Oper. Profit before Tax
Interest/Dividends Recd.
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
(inc)/dec in FA
(Pur)/Sale of Investments
CF from Investments
Change in Net Worth
Inc/(Dec) in Debt
Interest Paid
Dividend Paid
CF from Fin. Activity
Inc/Dec of Cash
Add: Beginning Balance
Closing Balance
2010
8,867
1,114
-1,089
-4,478
4,414
-6,457
-48
-6,505
6,141
-833
-385
-1,483
3,440
1,348
778
2,126
2011
10,068
1,934
-1,173
-2,647
8,181
-4,545
233
-4,312
174
64
-345
-1,575
-1,682
2,187
2,015
4,202
2012
11,821
2,768
-3,055
-5,370
6,164
-8,736
4
-8,733
430
4,094
-355
-1,777
2,392
-177
4,202
4,025
2013
19,981
2,997
-5,652
-5,166
12,160
-4,497
7
-4,490
475
-5,317
-410
-2,095
-7,348
323
4,025
4,348
2014
26,505
3,688
-9,475
-4,368
16,349
-6,098
-1,764
-7,862
1,593
-4,248
-267
-2,939
-5,861
3,626
4,349
7,975
2015E
35,688
3,740
-11,005
-11,461
16,961
-5,250
0
-5,250
1
0
-99
-3,677
-3,775
8,784
7,975
16,759
(INR Million)
2016E
44,652
2,276
-13,002
-7,090
26,836
-7,250
0
-7,250
0
0
-120
-4,203
-4,322
15,264
16,759
32,022
2017E
54,776
2,601
-16,128
-8,341
32,908
-7,250
0
-7,250
0
0
-120
-4,728
-4,848
20,810
32,022
52,833
3 February 2015
13

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