Company Details

Suven Life Sciences Limited, a research-based biopharmaceutical company, designs, manufactures, and

supplies bulk actives, drug intermediates, and fine chemicals for the life science industry worldwide. It

provides advanced intermediates, intermediates, and active pharmaceutical ingredients.

The company also offers contract research and manufacturing services, including development and supply

of pharmaceutical and agro chemical intermediates for new chemical entities. In addition, it provides

discovery and development of new chemical entities for CNS disorders; research collaborative projects with

pharmaceutical companies; and drug discovery research services, including in-vitro screening and molecular

biology, drug metabolism and pharmacokinetics, pharmacology, toxicology and genotoxicity and bioanalysis

as well as operates a formulation development center. The company was formerly known as Suven

Pharmaceuticals Pvt. Ltd. and changed its name to Suven Life Sciences Limited in 2003.

Suven Life Sciences Limited was founded in 1989 and is based in Hyderabad, India. Suven Life Sciences

Limited principally serves customers in the United States and Europe, and sells bulk actives and other

intermediates primarily to customers in India.

Suven has a total of thirteen (13) granted patents from Eurasia, twelve (12) granted patents from Japan and

seventeen (17) product patents from Mexico. These granted patents are exclusive intellectual property of

Suven and are achieved through the internal discovery research efforts

The current market capitalization stands at Rs 2,656.39 crore. The company has reported a standalone

sales of Rs 139.83 crore and a Net Profit of Rs 24.84 crore for the quarter ended Sep 2014.

Category No. of Shares Percentage

Promoters 75,657,576 64.76

General Public 28,556,496 24.44

Foreign - NRI 5,226,875 4.47

Other Companies 4,549,648 3.89

Foreign Institutions 1,621,811 1.39

NBFC and Mutual Funds 628,000 0.54

Others 537,553 0.46

Financial Institutions 50,829 0.04

Market Cap (Rs Cr) – 2656.39

Company P/E – 20.68

Industry P/E – 24.43

Book Value (Rs) – 20.86

Dividend (%) – 250%

EPS (TTM) – 10.09

Dividend Yield (%) – 120%

Face Value (Rs) - 1

Share Holding Pattern Financial Details

Industry Details

The Indian pharmaceutical market is set to become the eight largest pharma market globally

by 2015. It is forecast to reach at least $40 billion by 2020 and increase its dominance as a

leading player in Asia. It is predicted that the Indian pharma market will be a significant global

competitor by 2020. This depends on the optimization of the following submarkets: public

health, generics, consumer healthcare drugs, biologics, vaccines and patented products.

Despite challenges like drug price control, poor healthcare infrastructure, quality management

and meeting global standards, Indian pharmaceutical sector will see sales rising 14.4 per cent

to $27 billion in 2016, according to a report.

Further, even as the industry is reeling under these challenges, it is reporting double digital

growth due to socio-economic factors like increasing sales of generic medicines, growth in

chronic therapies and greater penetration in rural markets among others.

The Indian pharmaceutical sector, which is rising as a hub of manufacturing cost-effective

generic medicine, accounts for over 10 per cent of global pharmaceutical production. The

sector which manufactures over 400 active pharmaceutical ingredients (APIs) is also a

forerunner in a wide range of specialties involving manufacturing of complex drugs.

“The main focus of the Indian companies is on countries with aging populations such as

Japan, Africa, and Latin America, which need cheaper drugs. It is estimated that Indian

companies will benefit by about $40 billion as 46 US drug patents expire in 2012-15,”

Balance Sheet

Sources Of FundsMar '14 Mar '13 Mar '12 Mar '11 Mar '10

Total Share Capital 11.68 11.68 11.67 11.67 11.59

Equity Share Capital 11.68 11.68 11.67 11.67 11.59

Reserves 252.76 142.78 115.85 115.06 106.47

Networth 264.44 154.46 127.52 126.73 118.06

Secured Loans 58.23 83.01 69.52 64.16 43.46

Unsecured Loans 8.05 9.00 8.36 1.60 6.60

Total Debt 66.28 92.01 77.88 65.76 50.06

Total Liabilities 330.72 246.47 205.40 192.49 168.12

Application Of Funds

Gross Block 267.40 238.30 198.89 159.77 155.79

Less: Accum. Depreciation 88.17 76.79 66.44 54.09 46.23

Net Block 179.23 161.51 132.45 105.68 109.56

Capital Work in Progress 12.82 4.15 27.36 3.40 3.40

Investments 0.04 0.07 4.52 20.39 11.60

Inventories 78.63 53.81 46.50 33.37 30.49

Sundry Debtors 65.47 23.78 25.24 31.37 32.61

Cash and Bank Balance 69.40 21.79 3.17 1.94 1.27

Total Current Assets 213.50 99.38 74.91 66.68 64.37

Loans and Advances 81.04 69.01 45.76 26.48 39.25

Total CA, Loans & Advances 294.54 168.39 120.67 94.17 104.58

Current Liabilities 116.02 72.25 65.32 24.12 54.75

Provisions 39.88 15.41 14.27 7.02 6.27

Total CL & Provisions 155.90 87.66 79.59 31.14 61.02

Net Current Assets 138.64 80.73 41.08 63.03 43.56

Total Assets 330.73 246.46 205.41 192.50 168.12

Book Value (Rs) 22.64 13.22 10.92 10.86 10.19

Profit and Loss Account

IncomeMar '14 Mar '13 Mar '12 Mar '11 Mar '10

Sales Turnover 510.31 257.88 204.21 151.04 129.82

Excise Duty 0.00 0.00 0.00 0.61 0.51

Net Sales 510.31 257.88 204.21 150.43 129.31

Other Income 3.03 1.04 1.90 1.25 -0.76

Stock Adjustments 13.98 5.60 5.65 0.53 4.08

Total Income 527.32 264.52 211.76 152.21 132.63

Expenditure

Raw Materials 151.06 88.80 81.87 55.83 43.22

Power & Fuel Cost 25.85 21.93 14.04 10.66 8.16

Employee Cost 31.44 25.38 22.83 18.77 15.75

Other Manufacturing Expenses 27.48 16.59 12.22 9.79 7.78

Selling and Admin Expenses 0.00 0.00 0.00 39.58 41.11

Miscellaneous Expenses 69.40 57.60 55.74 2.72 2.93

Total Expenses 305.23 210.30 186.70 137.35 118.95

Operating Profit 219.06 53.18 23.16 13.61 14.44

PBDIT 222.09 54.22 25.06 14.86 13.68

Interest 10.51 13.51 9.91 6.11 4.44

PBDT 211.58 40.71 15.15 8.75 9.24

Depreciation 8.84 7.87 6.00 5.45 5.29

Profit Before Tax 202.74 32.84 9.15 3.30 3.95

PBT (Post Extra-ord Items) 202.74 32.84 9.15 3.20 3.95

Tax 58.58 2.01 -5.22 -7.14 -3.05

Reported Net Profit 144.16 30.84 14.36 10.40 7.00

Total Value Addition 154.17 121.49 104.84 81.52 75.74

Equity Dividend 29.21 3.50 3.50 2.92 2.90

Dividend and Bonus History

Index and Company Comparison

Company Forecast

PBIT – 40.95 v/s 17.5

RoCE – 64.47 v/s 18.81

RoE – 68.83 v/s 21.87

Net Profit Margin – 28.08 v/s 11.91

Return on net worth – 54.51 v/s 11.81

Reserves – 252.76 cr v/s 142.78 cr

PAT – 144.16 cr v/s 30.84 cr

Total assets – 330.73 cr v/s 246.46 cr

Net sales – 250.10 cr v/s 257.88 cr

Book Value – 22.64 cr v/s 13.22 cr

Days BSE NSE

30 210.05 210.28

50 208.86 209.06

150 155.72 155.82

200 136.42 136.52

Important Ratios Simple Moving Average

Buy Suven Life Sciences at current or lower market levels

Reasons for the recommendations are :

Sound financial position of the company.

Availability of adequate manufacturing facility to meet demands.

Partnership and MoU with worlds leading pharma companies.

Patents for various products from Europe, Pan Asia and America.

Increasing demand of the product mix.

Low Debt Equity Ratio.

Constantly good performance and maintenance of good profit margin.

Huge growth potential in Contract Research And Manufacturing Services (CRAMS) in

pharma sector in India.

Recommendations