2 November 2015
2QFY16 Results Update | Sector:
Healthcare
BSE SENSEX
26,657
Bloomberg
Equity Shares (m)
M.Cap. (INR b) / (USD b)
52-Week Range (INR)
1, 6, 12 Rel.Per (%)
Avg Val(INR M)
Free float (%)
S&P CNX
8,066
TRP IN
169.2
236/3.7
1720 /861
6/29/80
198
28.8
CMP: INR1,542
TP: INR1,850 (+20%)
Torrent Pharma
Buy
Abilify drives 2Q; outlook remains strong
Financials & Valuation (INR Billion)
Y/E MAR
Sales
EBITDA
Net Profit
EPS (INR)
EPS Gr. (%)
BV/Sh. INR
RoE (%)
RoCE (%)
P/E (x)
P/BV (x)
2015 2016E 2017E
46.5
10.2
5.7
33.4
4.9
25.7
27.7
46.2
10.5
70.2
26.6
11.0
64.8
93.9
35.7
51.0
23.8
7.1
69.6
18.1
13.3
78.4
21.1
32.5
31.6
19.7
5.8
147.2 216.0 267.2
Estimate change
TP change
Rating change
Torrent’s PAT at INR5.7b (up 189% YoY) was 27% ahead of estimates, mainly on
superior margins (42% v/s 34.4% est.). Sales also grew 39% YoY (7% miss) to
INR16.9b, led by Abilify sales in the US.
Strong US sales offset weak performance in other segments:
The US business
grew four-fold to INR7.1b, led by Abilify sales. However, other segments reported
poor numbers during this quarter. India biz remained flat YoY to INR 4.4b, mainly
on account of stoppage of promotional activities (Bonus sales etc.). Currency
movement continued to impact other markets as LatAm declined 18%YoY and
RoW declined 16%YoY. EU business was impacted by lower traction in UK and
Romania region, declined 2%YoY in 2Q. Impact of high-margin US launches like
gAbilify, gNexium, gDetrol and recent price hikes in domestic products are
expected to result in strong revenue traction over FY15-18E (20% CAGR).
Base business profitability improved:
EBITDA margin at 42% (up 2000bp YoY) was
ahead of our estimates due to abnormally high Abilify sales in 2Q. Adjusted for
Abilify sales (est.USD:75m in 2Q) in the US, underline base business performance
was improved by rationalization efforts across geographies and key segments –
Higher profitability in India and Brazil. We expect EBITDA margins to expand
460bp over FY15-18E, led by (a) high-impact US launches, (b) higher synergies
from Elder brand acquisition, (c) ramp-up in LatAm and EU markets and (d)
improved MR productivity in India. As a result, EBITDA is likely to grow at a 28%
CAGR over FY15-18E.
Improving business mix, profitability and balance sheet to drive re rating:
We
remain positive on TRP’s re-rating potential due to (a) strong EPS momentum of
43% CAGR over FY15-18E, (b) potential ramp-up in the US business (low base) (c)
460bp EBITDA margin improvement, (c) healthy return ratios (from 27.7% ROCE in
FY15 to 33.8% in FY18E), and (d) substantial reduction in debt due to INR48b free
cash flows over FY16-18E. Reiterate
Buy
with a target price of INR 1,850 (21x
Sep’17E EPS—in line with the sector).
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.

Torrent Pharma
2Q Result Snapshot
Exhibit 1:
Quarterly Snapshot (Revenue mix)
(INR m)
Revenue split
USA
India
Europe
LatAm
RoW
CRAMs
Total revenues
2QFY15
1,670
4,420
1,900
1,600
950
1,630
12,030
1QFY16
8,880
4,910
2,420
1,380
760
1,110
19,460
2QFY16
7,120
4,410
1,860
1,310
800
1,410
16,910
%YoY
326.3
(0.2)
(2.1)
(18.1)
(15.8)
(13.5)
40.6
%QoQ
(19.8)
(10.2)
(23.1)
(5.1)
5.3
27.0
(13.1)
FY15
8,320
16,090
9,240
6,060
3,870
2,950
46,530
FY16E
%YoY
26,549
219.1
19,189
19.3
9,388
1.6
6,164
1.7
3,787
(2.2)
5,165
75.1
70,242
51.0
Source: Company, MOSL
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
EBITDA
EBITDA margin (%)
Depreciation expenses
EBIT
Interest cost
Other (expenses)/income net
PBT
Income tax (benefit)/expense
Effective tax rate (%)
Net Profit - reported
2QFY15
12,170
3,810
8,360
68.3
2,240
18.6
3,390
28.2
2,730
22.4
560
2,170
540
720
2,350
370
15.7
1,980
1QFY16
19,470
4,180
15,290
78.3
2,100
10.9
4,100
21.3
9,090
46.7
590
8,500
580
670
8,590
4,100
47.7
4,490
2QFY16
16,910
3,760
13,150
77.3
2,100
12.7
3,910
23.6
7,140
42.2
610
6,530
480
1,270
7,320
1,640
22.4
5,680
%YoY
38.9
(1.3)
57.3
895 bp
(6.3)
(593)bp
15.3
(455)bp
161.5
1,979 bp
8.9
200.9
(11.1)
76.4
211.5
343.2
666 bp
186.9
%QoQ
(13.1)
(10.0)
(14.0)
(97)bp
0.0
176 bp
(4.6)
229 bp
(21.5)
(446)bp
3.4
(23.2)
(17.2)
89.6
(14.8)
(60.0)
(2,533)bp
26.5
FY15
46,530
14,150
32,380
69.1
8,420
18.4
13,760
30.0
10,200
21.9
1,910
8,290
1,750
2,860
9,400
1,890
20.1
7,510
FY16E
%YoY
70,242
51.0
17,385
22.9
52,857
63.2
75.3
611 bp
8,861
5.2
12.6
(575)bp
17,386
26.4
24.8
(526)bp
26,610
160.9
37.9
1,596 bp
2,413
26.3
24,197
191.9
1,962
12.1
2,710
(5.2)
24,946
165.4
8,132
330.3
32.6
1,249 bp
16,813
123.9
Source: Company, MOSL
2 November 2015
2

Torrent Pharma
Abilify continues to drive overall business performance for 2
nd
straight qtr
2Q sales increased 39%YoY to INR16.9b, primarily due to higher than expected sales
in gAbilify in the US. Within segments, apart from US, all other segment reported
negative or flat growth for 2Q.
US (46% of sales):
US business increased 327% YoY to INR7.1b, led by gAbilify
launch in the US. Currently, there are only six players in the market, with 65%
price erosion. Recently, Aurobindo also received ANDA approval for gAbilify.
There are still 3-4 players with tentative approval, which are expected to enter
the near term (post final approval). Recently, TRP also launched gNexium and
gDetrol LA in the US market. However, it is yet to gain significant traction in
these products. Management has indicated that they will target 15% market
share in most of the US launches ahead.
Till date, TRP has received 50 ANDA approvals in the US while 20 filings are still
pending. (40 products under development). TRP expects to launch 8-10 products
for FY16. With interesting recent launches like gNexium, gDetrol, gExforge and
gAbilify, we expect growth momentum in US to continue for next few quarters.
The management also indicated that out of 20 pending filings, most of the
products will be launched over next two years.
The company will also be filing 25 ANDAs from Zyg pharma over next two years
(10 –FY16, 15- FY17E). Currently, it is a CRAMs business and expects to start
contributing meaningfully in the US business from FY19-20 onwards.
Exhibit 3: US revenues (Quarterly)
US base sales (USD m)
One-offs (USD m)
111
37
17
17
17
20
19
7
17
28
21
24
75
3
25
4
25
5
31
28
35
Source: Company, MOSL
India (26% of sales):
India business remained flat at INR4.4b, due to stoppage of
bonus sales in to distributors and retailers. Adjusting for this, India sales grew
14%YoY in 2Q. Elder brands – Shelcal and Chymoral also grew at 42% and 78%
respectively. TRP is also expected to take price increase in elder brands in Nov’15.
The company also launched first biosimilar in Indian market (partnered with
Reliance life sciences) and expected to launch one more biosimilar in 3Q
(Adalimumab).
2 November 2015
3

Torrent Pharma
Exhibit 4: India Revenues (Quarterly)
India sales (INR b)
YoY growth (%)
54.7
49
41
13
4
4
4
4
5
-0.2
4
39.1
13
3
10
2
12
3
10
3
15
3
17
3
Source: Company, MOSL
Brazil (8% of sales):
Brazil business grew 10% ahead of market in constant
currency (18% decline in rupee). The company has taken several steps in Latin
business to improve profitability and improve MR productivity. TRP has reduced 50
MRs in last one year and retail margins in Brazilian market. Going ahead, TRP
expects to launch similar portfolio in Brazil that they have in India. Currently, it ranks
4
th
in CNS covered market of Brazil.
Europe (11% of sales)
: Europe reported 2% decline in sales, affected by lower
sales in UK and Romania region. Going ahead, TRP expects to focus on Germany
(ranked 6
th
in generics) and UK market and likely to see 10-15% growth over next
few years.
Exhibit 5: Europe sales trend
54.2
59.0
2.5
19.0
Europe (INR b)
27.0
1.9
2.4
2.5
2.5
(19.1)
2.2
(8.5)
2.3
(12.7)
YoY growth (%)
26
2.4
(2.8)
(2.1)
1.9
1
8
1
12
-4
1
1
2
Exhibit 6: Brazil sales trend
Brazil (INR b)
28
5
10
-7
2
1
1
-18
1
YoY growth (%)
Margins at 42%; but likely to normalize at 25-26% going ahead
Source: Company, MOSL
Source: Company, MOSL
EBIDTA increased 162% YoY to INR 7.1b, with margins improving to 42% in 2Q. Gross
margins stood at 77%, 895bp higher than 2QFY16, due to one off sales of gAbilify in
the US (with superior gross margins- >90%).
Over FY15-18E, we expect Torrent’s EBITDA margins to scale up from 21.9% to
26.5% led by (a) Improved MR productivity in domestic business (management is
targeting improvement from INR 5m per person annually to INR 9m per person
annually, (b) scale-up in US business backed by high value launches and (c) higher
operating leverage from emerging markets.
2 November 2015
4

Torrent Pharma
Expects to file complex generic products in the US
The company intends to increase the number of scientists to 1100 and has already
hired 200 people in 2Q. Apart from Oral solids (core –strength), it is also expected to
develop Derma and oncology products going ahead. New brownfield facilities would
be coming up at Indrad for Oncology and Injectable products. US FDA has
successfully inspected Dahej plant in 1Q and EIR is expected to come by Dec’15.
EBITDA margins jumped to 42%
EBITDA (INR b)
28.6 31.0
18.4 21.2
EBITDA margin (%)
46.7
42.2
112.6
22.4 20.5
14.0 9.1
35.0
7.1
46.3
17.4 17.9
105.0
71.8 75.2
26.1
(46.7)
1.1 1.2 1.5 1.1 1.3 2.4 2.6 2.0 1.7 1.3 4.5 5.7
75.4
Exhibit 7: PAT growth trends
PAT (INR m)
YoY growth (%)
186.9
20.2
25.3
21.4
1.6 2.2 2.1 1.8 2.2 3.5 3.5 2.7 2.4 1.6
Source: Company, MOSL
Source: Company, MOSL
2 November 2015
5

Torrent Pharma
Operating metrics
Exhibit 8: Key operating metrics
3QFY13 4QFY13
Revenue Mix (%)
USA
India
Europe
LatAm
RoW
CRAMs
Revenue Gr. (%)
USA
India
Europe
LatAm
RoW
CRAMs
As % of sales
Raw material
Staff cost
Other expenses
Tax Rate
Margins (%)
Gross Margins
EBITDA Margins
EBIT Margins
PAT margins
1QFY14 2QFY14
3QFY14 4QFY14
1QFY15
2QFY15 3QFY15
4QFY15 1QFY16 2QFY16
11.5
32.4
19.5
14.7
9.8
11.4
14.1
43.8
12.7
8.3
(2.5)
30.0
5.6
10.6
25.0
24.2
15.3
9.4
14.6
22.7
46.0
9.8
59.5
6.3
21.7
17.5
11.6
32.1
20.1
13.7
8.7
12.5
22.9
43.2
12.3
49.0
(1.8)
20.6
4.9
11.8
30.6
24.2
12.9
10.0
10.5
25.1
24.5
9.6
54.2
7.7
41.0
50.8
14.6
29.3
24.4
14.6
9.4
7.8
28.6
60.9
14.9
59.0
26.5
21.8
(28.0)
32.6
20.9
20.5
10.4
8.4
7.2
50.4
334.8
17.4
19.0
(3.8)
25.6
(14.9)
24.1
31.7
22.3
13.4
6.0
2.5
20.9
137.6
13.1
27.0
12.0
(21.2)
(58.2)
13.7
36.3
15.6
13.1
7.8
13.4
28.7
45.2
48.8
(19.1)
28.0
(2.1)
63.0
14.6
36.0
19.4
13.4
9.1
5.7
16.8
15.5
41.4
(8.5)
5.4
11.6
15.0
19.5
34.3
19.0
12.2
8.6
6.4
(6.1)
(43.8)
54.7
(12.7)
10.2
(3.9)
(10.0)
45.6
25.2
12.4
7.1
3.9
5.7
75.8
230.7
39.1
(2.8)
(7.4)
13.4
296.4
42.1
26.1
11.0
7.7
4.7
8.3
38.5
326.3
(0.2)
(2.1)
(18.1)
(15.8)
(13.5)
32.1
20.0
30.7
21.6
67.9
20.2
17.7
14.1
30.3
20.4
30.4
24.5
69.7
25.3
22.7
13.7
33.7
19.0
31.9
20.3
66.3
21.4
19.2
15.3
32.2
19.4
33.1
25.7
67.8
18.4
16.2
11.6
32.1
18.1
30.6
16.0
67.9
21.2
19.1
13.0
26.5
17.2
28.7
23.0
73.5
28.6
26.7
19.9
27.6
16.8
26.0
26.6
72.4
31.0
29.1
23.0
31.7
18.6
28.2
15.7
68.3
22.4
17.8
16.3
32.2
17.2
30.9
16.9
67.8
20.5
15.9
14.3
31.8
20.7
34.9
16.1
68.2
14.0
8.8
11.3
21.7
10.9
21.3
47.7
78.3
46.7
43.7
23.1
22.7
12.7
23.6
24.2
77.3
42.2
38.6
33.6
Source: Company; MOSL
2 November 2015
6

Torrent Pharma
Valuation and view
Strong traction in US business (including one-off) as well as expectations of higher
synergy benefits from Elder’s domestic portfolio acquisition has aided re-rating for
TRP over the last few months. We expect core earnings (excluding one-offs)
trajectory to remain strong (forecast 44% CAGR over FY15-18E) as we think margin
upside in domestic portfolio is still not fully reflected. We expect the stock trade
much above its historic P/E band due to higher revenue visibility and deleveraging
prospects.
Our TP of INR 1850 implies 20% upside from current levels. Our TP discounts TRP’s
base business at 21x FY17E P/E, in line with current sector average multiple. This is
at the higher end of its historical average and in line with current multiples.
Sustenance of high earnings growth and de-leveraging of Balance Sheet justify
upward shift of its average P/E band upwards.
Key catalysts to drive stock’s performance over the medium term are:
Improvement in EBITDA margin, mainly on stronger contribution from Elder
brands
Execution in key US launches including gNexium, gDetrol LA
Improved free cash generation, driving Balance Sheet deleveraging
Risks to our investment thesis
Regulatory delays could affect timely launch of key US launches.
Increased span of drug price control could hurt domestic business (34% of total
sales).
Unstable currency and macroeconomic outlook for key emerging markets like
Brazil/Russia could dampen growth prospects.
Exhibit 9: Historical PE trend
30
23
16
9
2
13.3
3.9
13.5
PE (x)
Median(x)
Peak(x)
Min(x)
Avg(x)
26.3
24.3
Exhibit 10: PE relative to sensex
Torrent Pharma PE Relative to Sensex PE (%)
100
50
0
-50
-100
-17.6
LPA (%)
50.5
Source: Company, MOSL
Source: Company, MOSL
2 November 2015
7

Torrent Pharma
Story in charts
Exhibit 11: Formulation led sales growth
Formulations (INR b)
CRAMS (INR b)
6
15.5
15.5
8.5
65
64
74
7
FY10
8
FY11
9
FY12
19.3
12.7
10
FY13
13.5
12
FY14
16
19
25
13.8
29
Exhibit 12: Domestic sales growth led by Elder acqn. in FY15
Revenues (INR b)
Growth (%)
38.5
30.6
5
6
2
16
2
19
3
24
3
28
3
38
2
44
FY10 FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E
Source: Company, MOSL
FY15 FY16E FY17E FY18E
Source: Company, MOSL
Exhibit 13: Base sales to grow at ~40% over FY15-18E
US base sales (USD m)
One-offs (USD m)
Exhibit 14: Latam - Gradual recovery ahead
Latam revenues (INR b)
32.1
Growth (%)
261
17.4
44
19
FY10
25
FY11
45
FY12
65
FY13
84
FY14
32
105
155
255
315
19.9
5
5.2
6.4
5
FY13
FY14
13.5
1.7
6
6
7
16.6
16.0
8
3
FY10
4
FY11
5
FY12
FY15 FY16E FY17E FY18E
Source: Company, MOSL
FY15 FY16E FY17E FY18E
Source: Company, MOSL
Exhibit 15: Europe business to grow at 9% over FY15-18E
Europe (INR b)
43.1
21.1
4
3.5
4
5
7
9
20.7
19.9
12.0
1.6
-0.6
9
9
12.4
11
12
Growth (%)
Exhibit 16: Healthy return ratios
RoCE (%)
36.2
29.2
29.3
24.4
29.7
28.8
33.5
36.0
RoE (%)
51.0
32.4
34.9
25.7
27.7
32.5
35.7 31.6
32.7
33.8
FY10 FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E
Source: Company, MOSL
FY10
FY11
FY12
FY13
FY14
FY15 FY16E FY17E FY18E
Source: Company, MOSL
2 November 2015
8

Torrent Pharma
Exhibit 17: EBITDA growth (%)
EBITDA (INR b)
EBITDA growth (%)
160.8
Exhibit 18: Gross margin to improve over FY16-18E
Gross Margin (%)
70.0
68.3
68.0
71.2
70.3
EBITDA Margin (%)
69.6
75.3
37.9
7.2
10
27
-32.0
18
18.3
21
FY10
FY11
FY12
FY13
FY14
FY15 FY16E FY17E FY18E
Source: Company, MOSL
21.5
17.6
19.4
21.6
22.7
21.9
71.3
71.5
36.3
-5.1
4
4
34.6
5
32.8
7
37.3
10
26.0
26.5
FY10 FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E
Source: Company, MOSL
Exhibit 19: ANDA filed v/s pending
ANDA filed
58
45
32
21
29
32
27
24
21
20
64
ANDA pending
67
70
70
Exhibit 20: Core EPS to grow at 43% CAGR (FY15-18E)
Core EPS (INR/ share)
One off
52
7
32
11
33
0
0
FY09
FY10
FY11
FY12
FY13
FY14
FY15
16
19
28
65
78
98
0
-2
-3
FY10 FY11 FY12 FY13 FY14 FY15 FY16E FY17E FY18E
Source: Company, MOSL
16
1
Source: Company, MOSL
2 November 2015
9

Torrent Pharma
Financials and valuations
Key assumption
Segment growth
USA
India
Europe
LatAm
RoW
CRAMs
Total Sales
Cost of sales (%)
EBITDA Margin (%)
2011
25.7
15.5
21.1
19.9
18.6
13.4
15.7
31.7
17.6
2011
21,978
15.4
3,878
17.6
626
3,252
391
347
3,208
-168
3,376
751
-15
736
22.9
2,640
0
2,640
2,702
2012
89.2
8.5
20.7
32.1
67.8
41.2
27.2
32.0
19.4
2012
26,961
22.7
5,218
19.4
817
4,400
395
445
4,451
863
3,588
690
40
730
16.4
2,858
23
2,835
3,287
2013
64.2
12.7
19.9
5.2
30.8
1.4
19.1
28.8
21.6
2013
32,120
19.1
6,930
21.6
830
6,100
340
430
6,190
370
5,820
1,732
-262
1,470
23.8
4,350
20
4,330
4,705
2014
118.6
13.5
43.1
6.4
27.9
0.3
30.3
29.7
22.7
2014
41,840
30.3
9,514
22.7
870
8,644
586
381
8,439
0
8,439
2,246
-445
1,801
21.3
6,638
0
6,638
5,385
2015
7.2
38.5
(0.6)
13.5
1.8
(25.2)
11.2
30.4
21.9
2015
46,530
11.2
10,202
21.9
1,907
8,295
1,752
2,856
9,398
0
9,398
711
1,177
1,888
20.1
7,510
0
7,510
5,650
2016E
219.1
19.3
1.6
1.7
(2.2)
129.6
51.0
24.8
37.9
2016E
70,242
51.0
26,610
37.9
2,413
24,197
1,962
2,710
24,946
0
24,946
5,222
0
5,222
20.9
19,723
0
19,723
10,958
2017E
(37.6)
30.6
12.4
16.6
17.3
12.0
(0.9)
28.8
26.0
2017E
69,588
-0.9
18,093
26.0
2,618
15,475
1,534
2,850
16,792
0
16,792
3,442
0
3,442
20.5
13,349
0
13,349
13,265
2018E
23.8
13.8
12.0
16.0
15.0
12.0
16.1
28.5
26.5
Income Statement
Y/E March
Net Sales
Change (%)
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income - Rec.
PBT before EO Expense
EO Expense/(Income)
PBT after EO Expense
Current Tax
Deferred Tax
Tax
Tax Rate (%)
Reported PAT
Less: Minority Interest
Net Profit
Adj PAT
(INR m)
2018E
80,764
16.1
21,403
26.5
2,804
18,599
677
2,900
20,822
0
20,822
4,268
0
4,268
20.5
16,553
0
16,553
16,553
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
Curr. Assets
Inventory
Account Receivables
Cash and Bank Balance
Loans & Advances
Curr. Liability & Prov.
Account Payables
Provisions
Net Current Assets
Appl. of Funds
E: MOSL Estimates
2011
423
9,801
10,224
16
480
5,720
16,440
9,643
3,287
6,355
1,799
1,460
15,742
5,048
3,404
4,788
2,502
8,916
7,490
1,427
6,826
16,440
2012
423
11,515
11,938
35
514
5,786
18,274
11,990
4,022
7,968
1,188
1,240
20,081
5,315
5,228
6,743
2,795
12,202
10,395
1,807
7,878
18,274
2013
423
13,796
14,219
4
257
7,030
21,510
12,785
4,587
8,198
2,853
605
25,872
9,239
6,878
6,270
3,485
16,017
12,297
3,720
9,855
21,510
2014
846
18,178
19,024
4
-182
11,418
30,264
14,200
5,447
8,753
5,341
1,857
34,091
10,061
10,994
7,694
5,342
19,777
16,239
3,538
14,314
30,265
2015
846
24,059
24,906
4
1047
25,040
50,997
35,429
7,103
28,327
6,783
2,977
40,183
10,672
15,945
5,674
7,892
27,273
22,890
4,383
12,910
50,996
2016E
846
35,700
36,546
4
1688
19,040
57,279
39,216
9,515
29,701
3,892
2,977
47,090
13,111
16,156
9,141
8,682
26,380
16,893
9,487
20,710
57,279
2017E
846
44,364
45,210
4
1688
15,040
61,942
43,189
12,133
31,056
2,446
2,977
52,807
15,089
16,005
12,164
9,550
27,343
19,436
7,907
25,464
61,943
(INR m)
2018E
846
55,107
55,953
4
1688
11,040
68,685
46,801
14,937
31,864
1,723
2,977
63,594
17,360
18,576
17,154
10,505
31,471
22,357
9,114
32,123
68,686
2 November 2015
10

Torrent Pharma
Financials and valuations
Ratios
Y/E March
Basic EPS (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
Return Ratios (%)
RoE
RoCE
Working Capital Ratios
Fixed Asset Turnover (x)
Debtor (Days)
Inventory (Days)
Working Capital Turnover (Days)
Leverage Ratio (x)
Interest Cover Ratio
Debt/Equity
2011
16.0
19.3
60.4
8.0
29.8
96.6
79.9
25.5
11.9
67.5
0.5
29.2
24.4
3.7
55
84
34
8.3
0.6
2012
19.4
21.6
70.5
8.5
29.2
79.4
71.4
21.9
9.6
49.8
0.6
29.7
28.8
3.8
71
72
15
11.2
0.5
2013
27.8
30.5
84.0
23.0
52.3
55.5
50.6
18.4
8.1
37.8
1.5
36.0
33.5
4.0
78
105
41
17.9
0.5
2014
31.8
44.4
112.4
10.0
29.8
48.5
34.8
13.7
6.3
27.8
0.6
32.4
34.9
4.9
96
88
58
14.7
0.6
2015
33.4
55.7
147.2
11.3
29.7
46.2
27.7
10.5
6.0
27.5
0.7
25.7
27.7
2.5
125
84
57
4.7
1.0
2016E
64.8
130.8
216.0
30.7
30.9
23.8
11.8
7.1
3.9
10.2
2.0
35.7
51.0
2.4
84
68
60
12.3
0.5
2017E
78.4
94.4
267.2
23.7
35.1
19.7
16.3
5.8
3.8
14.6
1.5
32.5
31.6
2.3
84
79
70
10.1
0.3
2018E
97.8
114.4
330.6
29.3
35.1
15.8
13.5
4.7
3.2
11.9
1.9
32.7
33.8
2.6
84
78
68
27.5
0.2
Cash Flow Statement
Y/E March
Oper. Profit/(Loss) before Tax
Interest/Dividends Recd.
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
EO Expense / (Income)
CF from Operating incl EO Expense
(inc)/dec in FA
Free Cash Flow
(Pur)/Sale of Investments
CF from Investments
Issue of shares
(Inc)/Dec in Debt
Interest Paid
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Add: Beginning Balance
Closing Balance
2011
3,878
347
-755
190
3,660
-168
3,828
-2,214
1,614
-48
-2,262
0
512
-391
-787
5
-661
905
3,883
4,788
2012
5,218
445
-696
902
5,869
863
5,006
-1,736
3,270
220
-1,516
0
85
-395
-836
-390
-1,535
1,955
4,788
6,743
2013
6,930
430
-1,728
-2,449
3,183
370
2,813
-2,460
353
636
-1,825
0
1,212
-340
-2,273
-61
-1,462
-473
6,743
6,270
2014
9,514
381
-2,239
-3,034
4,622
0
4,622
-3,904
718
-1,252
-5,156
423
4,388
-586
-1,980
-286
1,959
1,425
6,270
7,694
2015
10,202
2,856
-660
-617
11,781
0
11,781
-22,923
-11,142
-1,120
-24,043
599
13,623
-1,752
-2,227
10,242
-2,020
7,694
5,674
2016E
26,610
2,710
-4,581
-4,332
20,406
0
20,406
-895
19,511
0
-895
-1,995
-6,000
-1,962
-6,088
-16,044
3,467
5,674
9,140
2017E
18,093
2,850
-3,442
-1,732
15,769
0
15,769
-2,527
13,242
0
-2,527
0
-4,000
-1,534
-4,686
0
-10,219
3,023
9,141
12,164
(INR m)
2018E
21,403
2,900
-4,268
-1,668
18,366
0
18,366
-2,889
15,477
0
-2,889
0
-4,000
-677
-5,810
0
-10,487
4,990
12,164
17,154
2 November 2015
11

Torrent Pharma
Corporate profile
Company description
Torrent Pharma is one of the second tier Pharma
companies that is actively targeting the regulated
generics and semi-regulated markets. The company
has strong presence in domestic market with focus
and leadership in CVS and CNS segments. Recent
acquisition of Elder’s brand in India strengthens its
positioning further. The company has large
presence in some of the key global markets like
Brazil and Germany while it is expanding its
footprint in key markets like US, Europe (excl.
Germany) and RoW.
Exhibit 26: Shareholding pattern (%)
Jun-15
Promoter
DII
FII
Others
71.3
6.7
12.4
9.7
Mar-15
71.3
6.8
12.3
9.7
Jun-14
71.5
7.0
12.6
8.8
Exhibit 25: Sensex rebased
Torrent Pharma.
1,800
1,500
1,200
900
600
Oct-14
Sensex - Rebased
Jan-15
Apr-15
Jul-15
Oct-15
Exhibit 27: Top holders
Holder Name
Lavender Investments Ltd
Franklin Templeton Investment Funds
HDFC Trustee Company Ltd-HDFC Mid Cap
% Holding
1.8
1.5
1.0
Note: FII Includes depository receipts
Exhibit 28: Top management
Name
Sudhir Mehta
Designation
Chairman
Exhibit 29: Directors
Name
Sudhir Mehta
Pradeep Bhargava*
Haigreve Khaitan*
Shailesh Haribhakti*
*Independent
Name
Markand Bhatt
Chaitanya Dutt
Samir Mehta
Exhibit 30: Auditors
Name
Delloite Haskins & Sells
Kirit Mehta & Co
Type
Statutory
Cost Auditor
Exhibit 31: MOSL forecast v/s consensus
EPS (INR)
FY16
FY17
MOSL
forecast
64.8
78.4
Consensus
forecast
77.9
70.8
Variation (%)
-16.9
10.7
2 November 2015
12

Torrent Pharma
NOTES
2 November 2015
13

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Pharma
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