Conference Call      
          Strides Acrolab
The company has revised revenue guidance to Rs 2500 crore for CY'11


Strides Acrolab has announced the results for the quarter ended September 2011 and held a teleconference call on 24th October 2011 to discuss the results and future growth strategies. The key takeaways of the call are as follows:

Financial Information:

Strides Acrolab Consolidated net sales surged by 87% to Rs 769.31 crore for the quarter ended September 2011, primarily on the back of sharp 266% rise in the R&D/Licensing Income to Rs 172 crore led by the Pharma business. Moreover, despite of higher other expenses (mainly due to the Rs 30 crore forex loss on receivables) operating profit had witnessed robust 72% growth to Rs 152.45 crore even though margins fell by 100 basis points to 19.6%. Further, Interest cost was higher by 25% to Rs 49.11 crore and depreciation by 42% to Rs 22.16 crore. As a result there is strong 143% growth in PBT before forex gain to Rs 81.38 crore. However, with forex loss of Rs 28.35 crore compared to forex gain of Rs 18.22 crore there is 2% marginal incline in the PBT to Rs 53.04 crore. The 44% decline in provision for the taxation led the 15% growth in PAT to Rs 46.83 crore. Further, After accounting minority interest Rs 0.36 crore compared to Rs 6.17 crore in the corresponding previous period net profit grew by 34% to Rs 46.47 crore.

Highlights of the call:
Consolidated net sales surged by 87% to Rs 769.31 crore for the quarter ended September 2011, on the back of robust growth across the segments coupled with the strong rise in R&D/Licensing Income led by the Pharma business.
Revenues from Pharma business grew by robust 60% to Rs 486 crore for the quarter ended September 2011, contributing 62% to the total sales.
Revenues from the Specialties business witnessed 131% jump to Rs 294 crore for the quarter ended September 2011, contributing 38% to the total sales.
Revenues include R&D/Licensing Income of Rs.172 Crores for the quarter ended September 2011 as against Rs.47 crore in the corresponding previous period.
During the quarter, EBITDA grew by robust 73% to Rs 152.65 crore despite Rs 30 crores Forex loss adjusted on the receivables are included in the other expenses. The break up of the segments to the forex loss contribution is Rs 25.4 crore from the Specialties business and Rs 4.3 crores from the Pharma business.
Further, Net sales witnessed strong 48% growth to Rs 1838.05 crore for the nine months ended September 2011, on the back of strong 35% growth in R&D/Licensing Income to Rs 358 crore.
Revenues from the Pharma business grew by 38% to Rs 1142 crore and Specialties business grew by 57% to Rs 737 crore for the nine months ended September 2011, contributed 61% and 39% to the total sales respectively.
EBITA grew 31% to Rs 399.59 crore for the nine months ended September 2011, despite Rs 13 crore forex loss adjusted on the receivables are included in the other expenses. The break up of the segments to the forex loss contribution is Rs 10 crore from the Specialties business and Rs 3 crore from the Pharma business.
Interest cost grew by 25% to Rs 49.11 crore for the quarter ended September 2011 and has grew more than expected on the back of restatement of FCCBs.
During the quarter, It has launched one oncology product and expected to launch 2 more products in Q4'CY 11.
It's Brazil JV expected to achieve breakeven this year and the performance during the quarter has been impacted due to the depreciation of Brazilian Real. Further, the key geographies contributing to the revenue are US, Brazil and Australia contributes more than 20% revenues from each.
The vancomycin product has 17-20% market share and further it has all the four strengths in the market.
The management insisted that it has no capacity constraints and has enhanced capacities to meet its orders.
It expects increase in demand in Specialties business as the one of the major player (Hospira) facility has witnessing production related problems.
The Company originally guided revenue of Rs 2200 crore for the CY'11 with a guidance for licensing income of Rs. 270 crore. However, Considering the strong YTD performance, it revises the guidance to Rs 2500 crore for the CY'11, as the company expects Rs 400 crore Licensing Income mainly on account of new licensing income on Pharma business.
Further, The Company originally guided EBITA of Rs 440 crore for the CY'11 now revised it to Rs 480 crore.
The company is confident of exceeding the higher end of guidance inspite of volatile currencies in its key markets and difficult macroeconomic conditions.

i would also have a look at sequent scientific....its a company now promoted by strides promoter group...

Market rumors say the deal might be done by mid Feb and pegged at 1.78 Billion$. I do not have links though for this.
~Supratik

I echo what Kabootar says, if I remember right, you were spot on about Wokhardt also.   

Originally posted by Kabootar Awesome excel_monkey. strides investment came through for us and yes, even current ex-dividend price is higher than the price when you recommended! Hats off to you buddy. Whats the secret behind your clear pharma analysis? Do you work in the industry.