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23 October 2015

2QFY16 Results Update | Sector: Healthcare

Cadila Health

Amey Chalke([email protected]);+91 22 3982 5423

BSE SENSEX S&P CNXCMP: INR443 TP: INR505 (+14%) Buy

27,288 8,252

Bloomberg CDH IN

Equity Shares (m) 1,.0240M.Cap. (INR b) / (USD b) 453.5/7.0

2-Week Range (INR) 454 / 255

1, 6, 12 Rel.Per (%) 7/25/58

12M Avg Val (INR M) 263

Free float (%) 25.2

Financials & Valuation (INR billion)

/E MAR 2015 2016E 2017E

ales 86.5 103.4 125.2

EBITDA 17.8 23.7 30.0

Net Profit 11.9 15.8 19.8

dj. EPS INR 11.7 15.4 19.3

EPS Gr. (%) 45.4 32.4 25.0

BV/Sh. (INR) 41.5 54.0 70.1

RoE (%) 30.8 33.7 32.9

RoCE (%) 24.9 31.4 33.2

P/E (x) 37.8 28.6 22.8

P/BV (x) 10.6 8.2 6.3

Estimate change

P change

Rating change

In-line results; Moraiya facility clearance remains a concern

Cadila’s (CDH) 2QFY16 PAT at INR3.7b (up 45% YoY) was in line with our estimates,led by strong momentum in the US, ROW and JV segments. Revenue grew 16% YoY

to INR24.4b (in line), while EBITDA grew 40% YoY to INR5.8b (est. of INR5.6b) on

improved margins (24.0% v/s est. of 22.3%). The reported other operating income

was higher at INR857m due to one-time payment received (INR203m) from the

partner on sale of eight ANDAs in the US. However, Moraiya facility clearance

remains a big overhang on the stock.

US business driving overall sales growth: US business grew 25.2% YoY to INR10b,

led by sustained traction in HCQs, Tamsulosin, Potassium Acetate and Morphine

Sulphate. RoW and JV sales also reported superior growth—35% and 25%,

respectively. India business continued to underperform the IPM market, with

10.4% YoY growth during the quarter. Steep fall in Euro and Real currencies hurtEurope (down 16%) and LatAm sales (down 19%). Key near-term drug launches

(including gAsacol HD, gToprol XL, and Transdermals) are expected to drive

overall growth in the US. We project 20% YoY revenue CAGR over FY15-18.

Improved business mix and currency lift margins in 2Q: EBITDA margins grew

400bp YoY to 24% (est. of 22.3%), driven by improved business mix and currency

benefits in 2Q. Gross margins improved to 65.3% (+520bp), offsetting the R&D

spend scale-up (+160bp YoY, 7.3% of sales) to INR1.7b. EBITDA margins are likely

to improve to 24.3% by FY18 (20.6% in FY15), driven by (a) quality US launches

(gAsacol HD) and (b) better operating leverage in RoW/JV business. As a result,

we expect EBITDA to grow 30% YoY over FY15-18.

Resolution of Moraiya facility issue near-term trigger: Moraiya facility is

expected to receive clearance by the USFDA in 3QFY16, which would be a key

near-term trigger as it will accelerate USFDA approvals going ahead. We expect

CDH to re-rate following the clearance, driven by (a) stronger EPS growth of 28%

(v/s 22% for the industry), (b) 950bp improvement in ROCE and (c) higher FCF

(which will to aid de-leveraging). Maintain Buy with a target price of INR505 (22x

FY17E EPS + INR12 for Asacol HD).

Quarterly Performance (Consolidated) (INR Million)

Y/E March FY15 FY16E MOSL Chg.

1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 2QE (%)

Net Revenues 20,501 21,080 21,895 22,882 24,340 24,394 25,615 29,373 86,514 103,731 25,272 -3.5 YoY Change (%) 25.2 20.7 17.0 16.2 18.7 15.7 17.0 28.4 19.8 19.9 19.9

EBITDA 3,735 4,194 4,441 5,317 5,217 5,847 5,930 6,804 17,841 23,807 5,638 3.7

Margins (%) 18.2 19.9 20.3 23.2 21.4 24.0 23.2 23.2 20.6 23.0 22.3

Depreciation 677 733 707 755 737 733 760 531 2,873 2,760 850

Interest 194 161 137 121 112 106 110 120 613 447 110

Other Income 83 164 103 203 804 311 240 275 554 1,629 205

PBT before EO Income 2,948 3,465 3,700 4,644 5,172 5,319 5,300 6,428 14,910 22,229 4,883

EO Exp/(Inc) -48 12 -49 364 -160 -269 0 0 433 -429 0

PBT after EO Income 2,996 3,453 3,749 4,280 5,332 5,588 5,300 6,428 14,477 22,657 4,883 14.4

Tax 524 571 791 708 1,723 1,580 1,087 1,318 2,594 5,707 1,074

Rate (%) 17.5 16.5 21.1 16.5 32.3 28.3 20.5 20.5 17.9 25.2 22.0

Min. Int/Adj on Consol 69 101 139 68 75 99 110 111 377 395 90

Reported PAT 2,402 2,781 2,819 3,504 3,534 3,909 4,104 4,999 11,506 16,555 3,719 5.1Adj PAT 2,363 2,791 2,817 3,838 3,426 3,716 4,104 4,999 11,793 16,555 3,719 -0.1

YoY Change (%) 19.8 93.6 39.7 53.4 45.0 33.2 45.7 30.3 54.8 40.4 -43.3

Margins (%) 11.5 13.2 12.9 16.8 14.1 15.2 16.0 17.0 13.6 16.0 14.7

E: MOSL Estimates

FY16EFY15

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.

http://www.motilaloswal.com/Institutional-Equities






23 October 2015 4

Cadila Health

Latam (2% of sales): In 2Q, LatAm sales declined 19%YoY to INR527m led by sharp

fall in Brazilian Reai currency. However, The constant currency growth remained

strong at 14%YoY. CDH has launched one product during this quarter; cumulatively

it has filed 128 dossiers till date. In Mexico, CDH has filed for one dossier in 2Q,

taking overall dossiers filings to 40. It also received 6 product approvals (Total: 30)

and launched 2 products (Total: 15) in 2Q.

Exhibit 6: REAL depreciated 31%YoY in 1Q

Source: Company, MOSL

Exhibit 7:

Brazil sales likely to register stronger growth in

coming quarters


Europe (3% of sales): In 2Q, Europe sales also declined 16% YoY to INR652m.

Management expects to grow EU revenues in line with respective market

growth in the coming years (7-8%). We have also factored in 7-8% growth over

FY15-18E.

Exhibit 8: Expect pick up in EU sales in coming quarters


Exhibit 9: EURO/INR depreciated 10% YoY in 2Q


Operating leverage and improved product mix to drive margin expansion in

FY17/18E: Margin improvement during the quarter was driven by higher US sales

and currency benefits received in 2Q. Going ahead, we expect CDH EBITDA margin

to improve to 23-24% by FY18E, driven by 1) Niche drug launches in the US (gAsacol

HD, Transdermals, etc.) and 2) Positive operating leverage in RoW and JV business.

R&D spend to stay in the range of 7-8%: R&D spends was at 7.3% of sales in 2Q and

management expects R&D to remain at higher levels with increased filings in

complex products in the US.

27 27 26 27 27 24 22 22

18(0) 4

(4) (1) (2)

(11)(16) (19)

(31)

2 Q F Y 1 4

3 Q F Y 1 4

4 Q F Y 1 4

1 Q F Y 1 5

2 Q F Y 1 5

3 Q F Y 1 5

4 Q F Y 1 5

1 Q F Y 1 6

2 Q F Y 1 6

REAL/INR REAL YoY (%)

622 639 573 544 647 610 547 553

527

28

(4)

(2)

4 4(5) (5)

2

(19)

2 Q F Y 1 4

3 Q F Y 1 4

4 Q F Y 1 4

1 Q F Y 1 5

2 Q F Y 1 5

3 Q F Y 1 5

4 Q F Y 1 5

1 Q F Y 1 6

2 Q F Y 1 6

Brazil (INR m) YoY growth (%)

942 1,186 845 1,012 777 847 740 836 652

24

6

(12)

9

(18)(29)

(12)(17) (16)

2 Q F Y 1 4

3 Q F Y 1 4

4 Q F Y 1 4

1 Q F Y 1 5

2 Q F Y 1 5

3 Q F Y 1 5

4 Q F Y 1 5

1 Q F Y 1 6

2 Q F Y 1 6

Europe (INR m) YoY growth (%)

82 84 85 82 80 77 70 70 72

19 20

1812

(2)(8)

(17) (14)(10)

2 Q F Y 1 4

3 Q F Y 1 4

4 Q F Y 1 4

1 Q F Y 1 5

2 Q F Y 1 5

3 Q F Y 1 5

4 Q F Y 1 5

1 Q F Y 1 6

2 Q F Y 1 6

EUR/INR EUR YoY (%)



23 October 2015 5

Cadila Health

Exhibit 10: EBITDA margins improved, driven by US


Exhibit 11: R&D spend to stay at elevated levels (7-8%)


Other takeaways

Guidance: Management had given sales guidance of INR 100b (18% YoY growth) For

FY16 and expects EBIDTA margin to improve to 21%+.

Net debt stands at INR10b (INR 13b in 1QFY16) with ~60% of this debt

denominated in foreign currency, largely in USD.

Effective tax rate guidance stands at 22-24% for FY16. Recent increase in tax

rates is due to changes in tax rates at subsidiary level.

2.3 2.6 2.9 2.9 2.5 3.3 3.7 3.7 4.2 4.4 5.3 5.2 5.8

14.9 15.917.8 17.7

14.617.6 18.9 18.2

19.9 20.323.2

21.424.0

2 Q F Y 1 3

3 Q F Y 1 3

4 Q F Y 1 3

1 Q F Y 1 4

2 Q F Y 1 4

3 Q F Y 1 4

4 Q F Y 1 4

1 Q F Y 1 5

2 Q F Y 1 5

3 Q F Y 1 5

4 Q F Y 1 5

1 Q F Y 1 6

2 Q F Y 1 6

EBITDA (INR b) EBITDA margin (%)

1.2 1.4 1.3 1.1 1.3 1.2 1.0 1.1 1.2 1.8 1.5 1.7 1.7

7.68.6

7.8

6.47.4

6.75.4 5.2

5.7

8.2

6.6 7.1 7.3

2 Q F Y 1 3

3 Q F Y 1 3

4 Q F Y 1 3

1 Q F Y 1 4

2 Q F Y 1 4

3 Q F Y 1 4

4 Q F Y 1 4

1 Q F Y 1 5

2 Q F Y 1 5

3 Q F Y 1 5

4 Q F Y 1 5

1 Q F Y 1 6

2 Q F Y 1 6

R&D expense (INR b) % of sales



23 October 2015 6

Cadila Health

Operating metrics

Exhibit 12: Key operating metrics

3QFY13 4QFY13 1QFY14 2QFY14 3QFY14 4QFY14 1QFY15 2QFY15 3QFY15 4QFY15 1QFY16 2QFY16

Revenue Mix (%)

India 35.7 35.7 38.0 36.0 31.4 32.0 32.8 32.3 29.2 29.6 30.6 31.1US 24.6 24.3 23.5 27.2 33.7 34.8 34.8 38.1 40.8 42.6 40.7 41.5

Europe 7.0 6.0 5.6 5.4 6.3 4.3 4.9 3.7 3.9 3.2 3.5 2.7

Brazil 4.2 3.7 3.2 3.6 3.4 2.9 2.6 3.1 2.8 2.4 2.3 2.2

Japan 1.1 0.9 0.7 0.8 0.8 0.7 - - - - - -

RoW 4.2 6.4 5.0 5.8 4.7 5.3 5.1 4.2 4.6 4.9 5.2 5.0

API & others 23.1 23.0 23.9 21.1 19.6 19.8 19.7 18.6 18.8 17.3 17.8 17.6

Revenue Gr. (%) 16.1 16.0 6.4 12.5 17.5 22.0 24.9 21.2 17.4 17.7 17.8 14.8

India 21.4 14.4 7.5 4.1 3.2 9.4 7.9 8.7 9.1 8.8 9.9 10.4

US 14.1 9.9 7.9 28.7 61.1 74.7 85.0 69.6 41.8 44.3 37.5 25.2

Europe 25.9 36.1 8.5 23.6 6.0 (12.1) 9.2 (17.5) (28.6) (12.4) (17.4) (16.1)

Brazil (15.9) 5.4 (18.9) 27.7 (4.1) (2.2) 4.0 4.0 (4.5) (4.5) 1.7 (18.5)

Japan 16.9 3.7 (12.2) (8.4) (19.4) 2.1 - - - - - -

RoW 32.0 85.6 14.0 34.4 30.1 0.4 27.7 (12.6) 15.0 8.0 19.5 35.4

API & others 19.8 2.3 2.1 10.9 26.2 26.5 24.4 12.8 3.9 10.5 (1.7) 0.7

As % of sales

Raw material 34.5 39.5 33.6 40.2 37.4 39.9 40.4 39.9 35.4 34.9 36.2 34.7

Staff cost 14.9 13.5 16.4 16.1 14.2 14.3 14.4 13.9 14.7 14.0 13.6 14.1

R&D cost 8.8 8.1 6.6 7.6 6.7 5.4 5.2 5.7 8.2 6.6 7.1 7.3

Other expenses 28.3 23.6 27.4 24.0 25.6 23.8 23.0 22.3 22.6 22.7 23.5 22.1

Tax Rate 36.1 (26.9) 9.1 5.0 17.0 11.8 17.4 16.6 21.4 16.7 32.2 28.3

Margins (%)

Gross Margins 65.5 60.5 66.4 59.8 62.6 60.1 59.6 60.1 64.6 65.1 63.8 65.3

EBITDA Margins 15.9 17.8 17.7 14.6 17.6 18.9 18.2 19.9 20.3 23.2 21.4 24.0

EBIT Margins 14.3 15.9 15.9 11.4 15.3 17.5 15.5 17.6 17.8 21.2 22.2 22.9

PAT margins 6.6 16.8 12.2 10.8 10.1 12.5 11.9 13.5 13.1 15.6 14.9 16.5

Source: Company; MOSL



23 October 2015 8

Cadila Health

Story in charts

Exhibit 15: Sales trend


Exhibit 16:

Scale up expected in FY17-18E in India

formulation business


Exhibit 17: Robust growth outlook in US


Exhibit 18: Brazil business to recover from regulatory issues


Exhibit 19:

Margins to improve …


Exhibit 20:

Stronger earnings growth ahead


28 33 39 48 57 71 84 120 143

3 3 3 3 34

4

55

FY10 FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E

Formulations (INR b) API (INR b)

14 16 19 23 25 27 30 35 40

12.2 12.1

16.9 22.6

6.1 8.6

12.5

15.015.0


DF Revenues (INR b) YoY Growth (%)

142 212 261

277

357 560 660 836 1,027

63

50

23

6

29

57

18

2723


US Revenues (USD m) Growth (%)

2 2 2 2 2 2 2 3 3

12

24

10

-4-1 0

6

19 18


Brazil Revenues (INR b) YoY Growth (%)

8 10 11 11 1218 24

3036

21.9 22.220.6

17.7 16.6

20.623.0 23.9 24.3


EBITDA (INR b) EBITDA Margin

5 6 6 6 8 12 15 19 262 1 1 0

1

0

FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 FY 16E FY 17E FY 18E

Core EPS (INR/ share) One Off



23 October 2015 9

Cadila Health

Exhibit 21: Rich ANDA pipeline


Exhibit 22: R&D expense to remain elevated on large filings


Exhibit 23:

Healthy return ratios


Exhibit 24:

Steady asset turnover ratio


Exhibit 25:

Key assumption (%) Segment growth 2011 2012 2013 2014 2015 2016E 2017E 2018E

India 12.1 16.9 22.6 6.1 8.6 12.5 15.0 15.0

US 43.8 28.8 21.2 44.0 56.3 24.9 27.5 23.6

Europe 0.5 8.3 23.9 5.5 (13.4) 6.0 8.0 8.0

Latin America 23.8 9.9 (3.6) (1.1) (0.4) 6.0 18.6 18.0

Japan 33.5 23.7 15.5 (10.1) NA NA NA NA

RoW 24.5 (4.6) 65.9 19.7 8.7 32.5 25.7 25.0

API & others 40.4 5.2 17.3 2.9 6.0 18.2 15.4 14.0

Total sales 25.1 14.6 21.3 14.7 20.1 18.9 20.7 19.0

Expenses

Raw material 31.9 31.9 36.5 37.6 36.8 34.7 34.0 33.9

Staff cost 13.7 14.3 14.2 14.8 14.0 13.1 12.7 12.5EBITDA Margins 22.2 20.6 17.7 16.6 20.6 23.0 23.9 24.3

Source:

92 106 131

148176

227

270

47 52 66 81100

139168

FY09 FY10 FY11 FY12 FY13 FY14 YTD

ANDA filed ANDA pending

2 2 3 4 4 6 8 9 12

5 46 6

5

67 7 8


R&D expense (INR b) % of sales

35.8 37.4

27.523.7 25.2

30.8 33.8 32.9 31.6

26.730.4

22.9

17.9 18.6

24.9

31.5 33.3 34.4


RoE (%) RoCE (%)

16 18 25 29 32 37 46 54 61

2.3

2.5

2.12.2

2.32.3

2.22.3

2.4


Gross Block (INR b) Fixed Asset turnover



23 October 2015 10

Cadila Health

Financials and valuations

Income Statement (INR Million)

Y/E March 2011 2012 2013 2014 2015 2016E 2017E 2018E

Net Sales 46,306 52,633 63,579 72,241 86,514 103,419 125,193 149,387

Change (%) 25.6 13.7 20.8 13.6 19.8 19.5 21.1 19.3Total Expenditure 36,044 41,795 52,327 60,239 68,672 79,680 95,210 113,098

% of Sales 77.8 79.4 82.3 83.4 79.4 77.0 76.1 75.7

EBITDA 10,262 10,838 11,252 12,001 17,841 23,739 29,983 36,289

Margin (%) 22.2 20.6 17.7 16.6 20.6 23.0 23.9 24.3

Depreciation 1,269 1,579 1,847 2,012 2,873 2,760 3,285 3,590

EBIT 8,993 9,259 9,405 9,989 14,969 20,979 26,698 32,699

Int. and Finance Charges 699 1,211 1,262 1,181 613 447 412 367

Other Income - Rec. 131 -107 -55 786 554 1,629 1,380 2,182

PBT before EO Expense 8,425 7,941 8,088 9,594 14,910 22,161 27,666 34,515

EO Expense/(Income) 0 0 0 172 83 -429 0 0

PBT after EO Expense 8,425 7,941 8,088 9,423 14,827 22,590 27,666 34,515

Current Tax 1,064 1,130 1,188 1,060 2,594 5,693 6,363 7,938Deferred Tax 0 0 0 0 0 0 0 0

Tax 1,064 1,130 1,188 1,060 2,594 5,693 6,363 7,938

Tax Rate (%) 12.6 14.2 14.7 11.2 17.5 25.2 23.0 23.0

Reported PAT 7,361 6,811 6,900 8,363 12,233 16,897 21,303 26,576

Less: Minority Interest 251 286 364 326 377 395 415 436

Net Profit 7,110 6,525 6,536 8,037 11,856 16,501 20,887 26,140

PAT Adj for EO Items 6,333 5,660 6,536 8,208 11,939 15,813 19,764 26,140

Change (%) 24.6 -10.6 15.5 25.6 45.5 32.4 25.0 32.3

Margin (%) 13.7 10.8 10.3 11.4 13.8 15.3 15.8 17.5

Balance Sheet (INR Million)

Y/E March 2011 2012 2013 2014 2015 2016E 2017E 2018EEquity Share Capital 1,024 1,024 1,024 1,024 1,024 1,024 1,024 1,024

Total Reserves 20,691 24,712 28,421 33,366 41,492 54,303 70,763 92,475

Net Worth 21,715 25,736 29,445 34,390 42,516 55,327 71,787 93,499

Minority Interest 669 904 1193 1443 1689 2084 2500 2935

Deferred liabilities 1127 1185 1005 961 586 586 586 586

Total Loans 11,034 21,307 27,946 23,955 23,760 22,260 19,760 17,760

Capital Employed 34,545 49,132 59,589 60,748 68,551 80,258 94,632 114,780

Gross Block 24,004 35,612 38,726 41,380 46,259 55,749 63,493 70,366

Less: Accum. Deprn. 5,331 6,786 8,470 10,142 12,737 15,497 18,783 22,373

Net Fixed Assets 18,673 28,826 30,256 31,238 33,522 40,251 44,711 47,993

Capital WIP 3,963 4,492 7,356 8,915 7,979 4,490 2,745 1,872Investments 207 242 1,145 866 1,544 1,544 1,544 1,544

Curr. Assets 23,263 30,232 34,965 38,845 47,426 61,119 73,457 94,955

Inventory 8,119 10,905 12,136 13,675 15,357 19,022 22,527 26,807

Account Receivables 7,652 8,863 9,551 11,337 15,884 18,926 22,910 27,338

Cash and Bank Balance 2,952 4,666 5,838 5,488 6,699 13,445 18,028 30,527

Loans & Advances 4,540 5,798 7,440 8,345 9,486 9,727 9,992 10,283

Curr. Liability & Prov. 11,561 14,660 14,133 19,116 21,920 27,145 27,824 31,583

Account Payables 9,379 12,379 11,660 16,189 17,191 20,544 20,006 23,293

Provisions 2,182 2,281 2,473 2,927 4,729 6,601 7,818 8,291

Net Current Assets 11,702 15,572 20,832 19,730 25,506 33,974 45,633 63,372

Appl. of Funds 34,545 49,132 59,589 60,749 68,551 80,258 94,633 114,781E: MOSL Estimates



23 October 2015 11

Cadila Health

Financials and valuations

Ratios

Y/E March 2011 2012 2013 2014 2015 2016E 2017E 2018E

Basic (INR)

EPS 6.2 5.5 6.4 8.0 11.7 15.4 19.3 25.5

Cash EPS 8.2 7.9 8.2 9.8 14.4 18.8 23.6 29.0

BV/Share 21.2 25.1 28.8 33.6 41.5 54.0 70.1 91.3

DPS 1.3 1.5 1.5 1.8 2.4 3.0 3.6 3.6

Payout (%) 20.8 27.1 30.5 27.1 24.1 21.8 20.8 16.7

Valuation (x)

P/E 71.3 79.8 55.0 37.8 28.6 22.8 17.3

Cash P/E 53.9 55.7 44.9 30.7 23.4 18.7 15.2

P/BV 20.8 17.5 13.1 10.6 8.2 6.3 4.8

EV/Sales 9.9 8.9 6.5 5.4 4.4 3.6 2.9

EV/EBITDA 44.8 43.2 39.1 26.2 19.3 15.1 12.0

Dividend Yield (%) 0.3 0.3 0.4 0.5 0.7 0.8 0.8

Return Ratios (%)

RoE 37.4 27.5 23.7 25.2 30.8 33.7 32.9 31.6

RoCE 30.4 22.9 17.9 18.6 24.9 31.4 33.2 34.4

Working Capital Ratios

Asset Turnover (x) 1.3 1.1 1.1 1.2 1.3 1.3 1.3 1.3

Fixed Asset Turnover (x) 2.6 2.2 2.2 2.3 2.7 2.8 2.9 3.2

Debtor (Days) 60 60 54 56 66 66 66 66

Inventory (Days) 64 76 70 69 65 67 66 65

Working Capital T/O (Days) 69 76 86 72 79 72 80 80

Leverage Ratio (x)

Debt/Equity 0.4 0.9 1.0 0.7 0.6 0.4 0.3 0.2

E: MOSL Estimates

Cash Flow Statement (INR Million)

Y/E March 2011 2012 2013 2014 2015 2016E 2017E 2018E

Oper. Profit/(Loss) bef.Tax 10,262 10,838 11,252 12,001 17,841 23,739 29,983 36,289

Interest/Dividends Recd. 131 -107 -55 786 554 1,629 1,380 2,182

Direct Taxes Paid -1,064 -1,130 -1,188 -1,060 -2,594 -5,693 -6,363 -7,938

(Inc)/Dec in WC -2,067 -2,156 -4,088 752 -4,566 -1,722 -7,076 -5,240

CF from Operations 7,262 7,445 5,921 12,480 11,235 17,954 17,924 25,293

EO Expense / (Income) 0 0 0 172 84 -429 0 0

CF from Operating incl EO Exp. 7,262 7,445 5,921 12,308 11,151 18,382 17,924 25,293

(inc)/dec in FA -4,460 -12,261 -6,141 -4,553 -4,221 -6,000 -6,000 -6,000

Free Cash Flow 2,802 -4,816 -220 7,755 6,931 12,382 11,924 19,293

(Pur)/Sale of Investments 0 -35 -903 279 -678 0 0 0

CF from Investments -4,460 -12,296 -7,044 -4,274 -4,899 -6,000 -6,000 -6,000

Change in Networth -401 -945 -1,086 -1,152 -1,154 -395 -415 -436

Inc/(Dec) in Debt 406 10,508 6,928 -3,741 52 -1,105 -2,085 -1,564

Interest Paid -699 -1,211 -1,262 -1,181 -613 -447 -412 -367

Dividend Paid -1,530 -1,845 -2,105 -2,266 -2,952 -3,690 -4,428 -4,428

Others -132 58 -180 -44 -374 0 0 0

CF from Fin. Activity -2,356 6,565 2,294 -8,384 -5,041 -5,637 -7,340 -6,795

Inc/Dec of Cash 445 1,714 1,172 -350 1,211 6,745 4,584 12,499

Add: Beginning Balance 2,507 2,952 4,666 5,838 5,488 6,699 13,445 18,028

Closing Balance 2,952 4,666 5,838 5,488 6,699 13,444 18,028 30,527

E: MOSL Estimates



23 October 2015 12

Cadila Health

Corporate profile: Cadila Healthcare

Exhibit 27: Shareholding pattern (%)

Jun-15 Mar-15 Jun-14

Promoter 74.8 74.8 74.8

DII 8.0 8.3 8.3

FII 7.0 6.4 5.9

Others 10.2 10.5 11.0

Note: FII Includes depository receipts

Exhibit 28: Top holders

Holder Name % Holding

Life Insurance Corporation of India Ltd 3.0

Government Pension Fund Global 1.1

Exhibit 29: Top management

Name Designation

Pankaj R Patel Chairman & Managing Director

Sharvil P Patel Deputy Managing Director

Exhibit 30: Directors

Name Name

Pankaj R Patel Mukesh M Patel*

Sharvil P Patel Nitin Raojibhai Desai*

H Dhanrajgir* Dharmishta N Rawal*

*Independent

Exhibit 31:

Auditors

Name Type

Mukesh M Shah & Co Statutory

Dalwadi & Associates Cost Auditor

Exhibit 32:

MOSL forecast v/s consensus

EPS

(INR)

MOSL

forecast

Consensus

forecast

Variation

(%)

FY16 15.4 14.9 3.6

FY17 19.3 18.0 7.5

FY18 25.5 20.7 23.2

Company description

Cadila is one of the largest domestic pharma

companies in India with a strong focus on the

global generics opportunity. The company isgradually building its presence in the regulated

generic markets beginning with the US and France.

It also plans to tap some unique opportunities

through its JVs with Takeda, Hospira, Bayer and

Bharat Serums.

Exhibit 26: Sensex rebased



23 October 2015 13

Cadila Health

N O T E S



23 October 2015 14

Cadila Health

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Disclosure of Interest Statement Cadila Health

Analyst ownership of the stock No Served as an officer, director or employee No

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