Sie sind auf Seite 1von 4

12/5/2016 StockAxis Jenburkt Pharma Ltd Research Report

 
Jenburkt Pharma Ltd - Research Report

Private Client Research

Rating Company Date


Buy
Jenburkt Pharma Ltd
November 18, 2016
Sensex 26150.24

CNX Nifty 8074.10


Reco Price Rs. 477.00

Price Target (6 - 9 Month's) Rs. 716.00 Exchange Code


Sector NSE -
Pharmaceuticals & Drugs Upside 50.10% BSE 524731

Strengthening the brands in respective segments will Stock Data

drive future growth. CMP (Rs) 488.00

Face value (Rs) 10

Strong Domestic Operations: 52 Week Range (Rs) 572.50 - 330.00


Jenburkt Pharma has a strong committed team of more than 575 sales force across India, Jenburkt
promotes all its 85 brands ethically across 75,000 doctors and 50,000 chemists regularly. Backing Market cap (Rs Crores) 226.89
the strong force company has more than 1000 stockists and 25 superstockists. Jenburkt also caters
Price To Book Value (x) 4.81
to large Government, Semi-Government Institutions, Missionary Hospitals, Public Sector Enterprises,
etc. P/E Ratio (x) 19.27

Growing International Exports: EV/EBIDTA (x) 10.10


Currently, Jenburkt's products are being exported to 15 countries globally with a clear focus to
expand on a yearly basis. Also Jenburkt is open to partnering foreign pharmaceutical firms to
market their pharmaceutical products in India; Company is also in search of a capable partner to
One Year indexed Stock Performance
market their pharmaceutical products across the globe through which they can improve on their
exports sales which constitutes small proportion of total sales. Jenburkt Pharma Ltd Sensex

Strengthening the Brand:


Company is focused on strengthening their brands in their respective segments during the last year.
There is a growing trend of competition from regional companies who operate either in a few
districts or in a few states in India. This is apart from the competition from large organizations
operating in India. Neuropathy detection camps and bone densitometry camps were carried out in
various parts of the country for detection of neuropathy and osteoporosis.. The strategy of
Company is to focus on long term therapies in acute and chronic ailments, by moving up the value
chain continuously. As a result, a few of the Company’s brands are the preferred choice in certain
segments. Company has some strong brand like CARTI SAFE FORTE (Anti Arithritic) , POWERGESIC
Tablets (Anti Inflammory Analogesic).They rank among the top five in those segments. Return (%) 1m 3m 12m 36m

Quality Portfolio of Products: Absolute 35.54 6.29 3.46 593.18


Jenburkt has good health through quality products that include prescription and over-the-counter
Sensex -6.78 1.73 2.62 25.42
drugs. Their prescription medicines span across various therapeutic areas such as anti-arthritic,
antimalarials, anti-osteoporotic, antibiotics, antidiabetics and anti-inflammatory drugs and more.
Hence Company has good quality of products in their portfolio.
Shareholders
Strong Manufacturing Facilities:
Company has the state-of-the-art manufacturing plant at Sihor-Gujarat, in India. The plant is modern (in %) 30-Sep
and well-equipped with spacious operational areas having adequate capacities for manufacturing
Promoter 45.81
world-class pharmaceutical and healthcare products. Company’s plant is approved as per W.H.O
Guidelines with current G.M.P requirements, apart from approvals from various countries. Public 54.19
Furthering the development of formulations, Jenburkt has a Research & Development unit duly
approved by the Ministry of Science & Technology, Government of India. Hence company has strong Others 0.00
manufacturing facilities to cater both domestic and international market. Also Jenburkt has a
https://www.stockaxis.com/Research­Reports/Jenburkt­Pharma­Ltd­WB­18­11­2016.aspx 1/4
12/5/2016 StockAxis Jenburkt Pharma Ltd Research Report
manufacturing facilities to cater both domestic and international market. Also Jenburkt has a
Total 100
progressive lineage of manufacturing high quality formulations backed by a strong Research &  
Jenburkt Pharma Ltd - Research Report
Development, Regulatory and global marketing team. The big thrust of Jenburkt's strategy is to
focus on creating a new category in the Indian and the International pharmaceutical market vis a vis.

Recent R&D Activities:


Recently company undertook commercial scale manufacturing of Frendacid, an antacid and
antiflatulance for export market. Also Company continue to work towards formulating new and
existing molecules for domestic and international market for efficient and cost saving drug delivery
systems. Hence company is in continuous process of improving on its product portfolio.

Strong Financials:
Last year company posted strong gross profit margins of above 67%, EBITDA margin above 15%,
PAT margins near 10% which are excellent numbers for mid cap pharma companies. With no further
capex required in next few years company can post 200 crore of sales in next three years. Also
employee cost which is 23% of total sales as on date is expected to reduce going forward as recent
capex will take place for execution hence margins will be increased gradually in next few years.
Company also pays regular dividend every year which help them to maintain strong dividend yield
+91 22 6639 3000
of above 4%. Company is debt free company with 16.75 crores of cash in hand. research@stockaxis.com

StockAxis.com - Private Client Research For Private Circulation Only 01

Industry
The Indian Pharmaceutical Industry is highly fragmented and grown across India, under two segments, the organised and the unorganised. SMEs are at
the core of the growth of the industry. These SMEs are taking advantage of the demand of high quality products in India and in the global market. Hence,
the Indian Government has also provided a boost to the SMEs. Noticeable progress is seen in clinical trials and innovations in the pharmaceutical
industry.

The Indian Pharmaceutical Industry is poised to escalate its growth, mainly due to the potentially huge demand for innovative and world class quality
drugs in India and in the overseas market, even though pricing plays a vital role for Companies in the industry. The growth in the industry is mainly driven
by contract manufacturing and backward integration, resulting in quality control and reduction in cost.

Profile
Jenburkt Pharmaceuticals Ltd, a venture to diversify into the healthcare and pharmaceutical industry, was formed in 1985 by the Bhuta family; late
Hemendra N. Bhuta was the promoter of the company while the Bhuta Group was founded by Nandlal Mulji Bhuta Jenburkt is engaged in manufacturing
and marketing of speciality and high quality pharmaceutical formulations and healthcare products. Jenburkt is a public limited company, with its stock
listed on the Bombay Stock Exchange. Jenburkt's headquarters are located in Mumbai, from where it’s entire operations.

Profit & Loss Statement:- (Standalone) (Rs Crores)


Particulars Mar-14 Mar-15 Mar-16 Mar-17E Mar-18E

Income:-

Gross Sales 76.2 86.53 94.94 108.5 123.5


Less: Excise Duty 0 1.28 1.36 1.50 1.65
Net Sales 76.23 85.25 93.58 107.00 121.85
Growth (%) 9.93 11.83 9.77 14.34 13.88
Total Expenditure 64.71 69.96 77.13 86.5 98.5
EBIDTA 11.52 15.29 16.45 22.00 25.00
EBIDTA Margin (%) 15.11 17.94 17.58 20.56 20.52
Other Income 1.61 2.07 2.73 2 2
Operating Profit 13.13 17.36 19.18 24.00 27.00
Interest 1.27 0.36 0.38 0.5 0.5
PBDT 11.86 17.00 18.80 23.50 26.50
https://www.stockaxis.com/Research­Reports/Jenburkt­Pharma­Ltd­WB­18­11­2016.aspx 2/4
12/5/2016 StockAxis Jenburkt Pharma Ltd Research Report
PBDT 11.86 17.00 18.80 23.50 26.50
Depreciation 1.55 2.66 1.99 2.7 2.7 
Jenburkt Pharma Ltd - Research Report
Profit Before Taxation 10.31 14.34 16.81 20.80 23.80

Exceptional Income / Expenses 0 0 0 0 0


Profit Before Tax 10.31 14.34 16.81 20.80 23.80
Provision for Tax 2.82 4.69 6.05 7.49 8.57
Profit After Tax 7.49 9.65 10.76 13.31 15.23
Adjusted EPS 16.15 20.81 23.18 28.68 32.82

Source: Stockaxis Research, Company Data

Valuation
Considering the strong product portfolio and stable financials company is trading at very low valuation.At CMP of Rs 477.00 stock is trading at 14.54x
FY2018E which is very low valuation for a mid cap pharma company. We assign the target price of Rs 716.00 where stock trades at 21.81x which is a fair
valuation for company in long term.

StockAxis.com - Private Client Research For Private Circulation Only 02

Opulent Investment Adviser Private Limited


CIN: U67190MH2014PTC256524
Add: 89, Floor-8, Plot-226, Bajaj Bhavan, Barrister, Rajani Patel Marg, Nariman Point, Mumbai – 400 021 (Maharashtra)

www.stockaxis.com research@stockaxis.com +91 22 6639 3000

DISCLAIMERS AND DISCLOSURES:

Opulent Investment Adviser Private Limited is registered as an Investment Adviser with SEBI bearing registration Number INA000002462 as per Securities and Exchange
Board of India (Investment Advisers) Regulations, 2013. Opulent Investment Adviser Private Limited offer investment advisory services to clients as well as prospects.

The analyst for this report certifies that all of the views expressed in this report accurately reflect his or her personal views about the subject company or companies and its
or their securities, and no part of his or her compensation was, is or will be, directly or indirectly related to specific recommendations or views expressed in this report.

Other disclosures by Opulent Investment Adviser Private Limited and its Research Analyst with reference to the subject company(s) covered in this report-:

Opulent Investment Adviser Private Limited does have any financial interest in the subject company: (NO)

Research Analyst or his/her relative’s have financial interest in the subject company: (NO)

Opulent Investment Adviser Private Limited and Research Analyst or his/her relative’s does have any material conflict of interest in the subject company: (NO)

Research Analyst or his/her relatives have actual/beneficial ownership of 1% or more securities of the subject company at the end of the month immediately preceding the
date of publication of Research Report: (NO)

The research Analyst has served as officer, director or employee of the subject company: (NO)

Our salespeople and other professionals may provide oral or written market commentary or trading strategies to our clients that reflect opinions that are contrary to the
opinions expressed herein.

This report is not for public distribution and has been furnished to you solely for your information and must not be reproduced or redistributed to any other person.

This report is not to be construed as an offer to sell or the solicitation of an offer to buy any security in any jurisdiction where such an offer or solicitation would be illegal. It is
for the general information of the users of stockaxis.com / Opulent Investment Adviser Private Limited.

https://www.stockaxis.com/Research­Reports/Jenburkt­Pharma­Ltd­WB­18­11­2016.aspx 3/4
12/5/2016 StockAxis Jenburkt Pharma Ltd Research Report

While reasonable care has been taken in the preparation of this report, it does not purport to be a complete description of the securities, markets or developments referred
 
Jenburkt Pharma
to herein, and we do not warrantLtd - Research
its accuracy Report
or completeness.

Opulent Investment Adviser Private Limited, its directors, analysts or employees do not take any responsibility, financial or otherwise, of the losses or the damages sustained
due to the investments made or any action taken on basis of this report.

StockAxis.com - Private Client Research For Private Circulation Only 03

https://www.stockaxis.com/Research­Reports/Jenburkt­Pharma­Ltd­WB­18­11­2016.aspx 4/4