DSIJ Mindshare

Granules India Posts Handsome Q4 Results

Granules posted a handsome growth of 55.33% in its topline and reported a revenue of Rs 318 crore in Q4FY14, which was the highest revenue in a quarter. However, the company posted lower 51.20% growth in its total expenses during the same period on yearly basis. This lower growth in total expenses compared to its topline boosted its EBITDA by 81.87 % to Rs 50 crore during the said quarter. Further, its net profit too surged by 90.33% during Q4FY14 to Rs 24 crore compared to Rs 12 crore in Q4FY13.

The considerable growth of 71.15% in the company's depreciation clearly indicates the considerable capital expenditure during the period under review against the same period previous year. However, this capital expansion was through debt funding as its finance costs too showed a handsome growth of 82.09% during the said period on yearly basis. The increasing debt burden by almost 100% growth to Rs 309 crore as of March 31, 2014 may become concern for the company in coming future.

However, on positive front, Granules showed an expansion of 230 basis points in its EBITDA margins to 15.77% during Q4FY14. Interestingly, the net margins too showed an expansion of 137 basis points to 7.44% despite of increasing financial charges and depreciation charges during the quarter on yearly basis. Looking at the performance of the company during the quarter, the investors can stay invested in this stock for further capital appreciation.

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