Zee Learn Q1FY19 Concall Summary

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 Company Update

  • Zee Learn in the last 10 to 12 quarters has consistently performed well, and the growths have been to the extent of about 35 to 30% both on the top line and bottom line.

  • Zee Learn has approximately 200 business partners as franchises.

  • Zee Learn through its Kidzee, and Mount Litera Schools operates in 700 to 750 cities pan India

  • Mahesh Tutorial is now a part of ZEE Learn

  • Mahesh Tutorial in this first quarter have done a breakeven and posted a small PAT of about approximately a Crore.

  • The company has acquired 60% and immediately as on date there are no plans to merge MT Educare.

Quarter performance including MT:

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  • The company attributes it’s increased the margin during the quarter to disciplined executions, accelerating growth and strong leadership bandwidth.

  • While we have made strategic investments to leverage the opportunities in the education sector,

  • The company is confident that its persistent focus on the operational efficacy of the newly acquired business of MT Educare will continue.

  • Company’s top line at the console level including MT stands at Rs. 113 crores which are up by 67&.

  • Company’s EBITDA is at Rs.42 crores vis-à-vis Rs.26 crores for the same period last year which is up by 62%.

  • Company’s EBITDA margin is at 37% vis-à-vis 38%. We have managed to maintain the margin in spite of MT consolidations.

  • Company’s PBT is at Rs.34 crores vis-à-vis Rs.19 crores for the same period of last year up by 77%.

  • Company’s PAT is at Rs.24 crores versus Rs.12.8 crores of the same period of last year up by 87%.

  • Company’s PAT margin is up by 21% vis-à-vis 19% for the same period.

  • Company’s minority interest is Rs.2.4 cross, and PAT stands at Rs.21.6 crores vis-à-vis Rs.12.8 crores which are up by 68%.

Quarter performance excluding MT:

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  • Company’s top line is at Rs.82.9 crores vis-à-vis Rs.66.9 crores which are up by 24%.

  • Company’s EBITDA is at Rs.31.9 crores vis-à-vis Rs.25.1 crores which are up by 27%.

  • Company’s EBITDA margin is at 38% vis-à-vis 37% for the same period of last year

  • Company’s PBT is at Rs.25.8 Cr vis-à-vis Rs.19.3 crores which are up by 34%.

  • Company’s PAT is at Rs.18 crores versus Rs.12.8 crores which are up by 41%.

  • Company’s PAT margin is at 22% against 19% for the same period of last year.

Zee Learn Standalone Quarter performance:

  • Zee Learn’s top line standalone stands at Rs.54.2 crores versus 51.7 crores which are up by 5%.

  • Company during the same quarter last year had a one-time revenue of around Rs.3.12 crores on account of sale of additional kits.

  • Company’s growth at a standalone level after excluding the past year’s quarter one-time revenue comes to around 12% which is in line with its normal growth.

  • Company’s standalone EBITDA stands at Rs.22.9 crores versus Rs.18.9 crores which are up by 21%.

  • Company’s EBITDA margin is 42% vis-à-vis 37% and on a standalone basis.

  • Company’s PBT is Rs.23.6 crores vis-à-vis Rs.17.9 crores which are up by 32%.

  • Company’s PAT at Rs.16.2 crores vis-à-vis Rs.11.6 crores which are up by 40%.

  • Company’s PAT margins stood at 30% versus 22% in the period during last year.

Receivables:

  • The company has Rs.16 Crores at Zee standalone level versus the same period last year we had Rs.14 crores debtors.

  • As far as DVPL is concerned the debtors has reduced to Rs.14 crores versus Rs.51 crores the same period last year.

  • The net debtors at MT are at about Rs.21 crores versus Rs.137 crores last year same quarter, so the company is very well placed regarding the receivables.

Borrowing:

  • The company has about Rs.118 crores borrowings at ZEE Learn standalone versus Rs.108 crores same quarter last year.

  • The company has Rs.122 crores at DVPL versus Rs. 121 crores same quarter last year and MT borrowings as on June stand at Rs.154 crores versus Rs.161 crores.

  • MTS started repaying their borrowings post-June, and there is a substantial reduction as of now.

KIDZEE:

  • Kidzee revenue has grown by 5% however when that one-time sale of kit during last year same quarter the Kidzee has grown up by about 12%.

  • Kidzee’s EBITDA margin was about 50% vis-à-vis around 47% same quarter last year.

  • Kidzee’s EBITDA is about Rs.21 crores versus Rs.18 crores last year.

  • Kidzee has about 1,10,000 students versus 102,000 students same period last year. So, there is a growth of about 8%.

  • The company expects to reach about 145,000 and a little above 145,000 students by the end of the financial year.

Mahesh Tutorial:

  • MT operates on self-operated models. Their centers which are there are mostly self-operated.

  • Mahesh Tutorial’s geographical spread is limited to 7 or 8 states.

  • The company sees an opportunity for MT to launch from the Zee Learn franchising model and help that in an asset-light manner to expand their business

  • The company sees an opportunity for MT to expand Pan India via ZEE Learn’s Kidzee and Mount Litera schools that operate in 700 to 750 cities pan India.

  • Mahesh Tutorial can become a partner of about 200 franchises of Zee Learn and utilize their real estate.

  • Zee Learn students would have access to very good content curriculum, of the higher classes specifically 9th 10th and 11th and 12th from the Mahesh Tutorial portfolio.

  • The company has to put a lot of efforts to acquire the consumers who come to Kidzee at the age of 2 years.

  • The company acquires and nurture them for the next 15 odd years.

  • The company only gets a limited part of their share of wallet because when the students are outside the four walls of the school, there are many other people catering to them for auxiliary services like test prep and tutorials etc

  • The company hopes to give more holistic and integrated services to the student community making their life simpler and also spreading its consumer acquisition costs over multiple offerings and broader revenue base

  • MT Educare has enrolled about 46,500 students through its various verticals in this quarter, versus about 35,400 students they served during the same quarter last year.

  • The company had cleared about Rs.51 crores of debt for MT Educare which were standing around 176 crores when we acquired MT Educare.

  • Company’s target is to reduce the debts in the MT Educare substantially and thereby save the interest cost.

  • The company revealed that the reduction in debt is also connected with the one-time payments that will be required to do as per the term sheet entered by MT Educare.

  • The company had infused 200 crores in MT Educare and by that time they had about 176 crores debts.

  • The Company aims to utilize that 200 crores substantially or largely to reduce the debt, to use about 15 crores to 20 crores in working capital.

Mount Litera Zee School

  • Mount Litera Zee School has about Rs.10 crores top line versus Rs.10 crores top line last year.

  • Mount Litera last year had two signups higher than the current year signup.

  • Mount Litera normally does around 15 signups during the year.

  • The EBITDA margin for Mount Litera franchisee business stands at 30% versus 26% last year.

Liberium

  • Liberium has delivered a turnover of Rs.19.6 crores versus Rs.9.4 crores, growth of about 108%.

  • Liberium currently is served by 3900 employees versus 2000 during the last year same period.

  • Liberium's EBITDA margin is about 5%, and PAT margin is about 3.6%.

KIDZEE Day Care:

  • The company plans to roll this out in 100 centers in the current year.

  • Kidzee Day Care’s theme is home away from home which provides the safe, secure and nursing environment for every child.

  • Kidzee Day Care is a comprehensive program hearing cognitive, social and emotional, combination of speech, language, sight and gross motor skill development for the child.

  • The company plans to start this pilot in the month of October.

  • The company expects a significant impact regarding revenue from these 100 centers.

Ankuram

  • The company plans to do a pilot across 50 such locations across the country.

  • Ankuram is aimed at providing structured quality education at an affordable cost in a safe and secure environment.

  • The company wants to give students the best chance of academic success by providing well-researched age appropriate and child-centered holistic curriculum.

  • The company has already done three signups so far, one in Udaipura which is in MP, Jamner in Maharashtra and Shahapur in Karnataka.

  • The company plans to do a launch in September with around 10 to 15 schools.

Smart classes ICD space:

  • The company has also taken small steps into the smart classes space ICD space and the objective being to identify stable government projects with a sustainable margin.

  • Company’s academic strength, Pedagogy, school management experiences give it the competitive edge.

  • The company so far has not ventured into this field, and this is the first time they plan to enter.

  • The company has already formed a partnership with –another entity Edu Solutions.

  • The company has got its first project which is the Agra smart city; it is a very small project with 30 digital classrooms for an order value of about 52 lakhs.

  • The company has few projects in the in the pipelines they are already in talks at Dharamshala, Telangana, Jammu and Kashmir and Jharkhand for similar projects.

Kidzee Learning Tab

  • The company has planned to make the Kidzee Learning Tab a mandatory part of the student kit as it would be linked to their curriculum, therefore providing better learning outcomes for the child.

  • The company mentions it as a cheaper option compared to what they had provided previously.

  • The company finds the tab to be convenient also, as it can be installed on any Android or IOS platform.

  • The company plans to start from the next academic year, and they are targeting 50,000 plus children in the pilot itself.

Wellness Health

  • The company believes that obesity is a real problem amongst children in India and therefore they plan to roll out a wellness program across our children both in Kidzee as well MLZS.

  • The company has been a pioneer in early child education, and this initiative is spreading the awareness about health and nutrition.

  • The company expects it to be a significant revenue driver for it because given the scale and the scope.

  • The company will be covering four broad parameters-general, dental, eye and dietary.

  • The company has received a very positive response and these have to be assessed by qualified doctors we are starting off with the pilot with 50 centers covering 5000 children’s in September and so far we have received a very encouraging response.

  • The company is also launching a parenting magazine for the network for the first time.

  • The company believes that it is very important to also communicate effectively with the parent community.

  • The company wants to deliver uniform; it is starting with uniforms with online delivery of uniforms across the network.

  • The company conventionally use to bring all material into its warehouse and then dispatch it to the respective schools, but here they want to go directly to the parents.

  • The company expects significant operational efficiencies benefits both regarding top line and bottom line as they go forward on this.

Robomate:

  • Robomate is online App; it is delivered to its customers in two formats, Whoever buys a test prep or tutorial package gets access to Robomate and secondly one can also buy it in a standalone mode directly.

  • Robomate is a SaaS-based platform which is very versatile.

  • Robomate is not only a tool for delivering content curriculum, etc., to the students, but it is also testing, self-assessment revision tool, and also the same tool can be used to manage the various activities within an educational institution.

  • The company expects the performance metrics for the direct part to be, that how many people have registered on the web portal for this particular app. Secondly, how many have done a download of the free trial which is offered for 3 or 4 days. And then how many have bought it?

  • The company will provide Robomate app to the students who buys a test paper or tutorial course from Mahesh Tutorial.

  • The company would have B2B tie-ups for the Robomate with many institutions.

  • The company generates two types of revenues from Robomate; one through the tutorials and the test prep that MT conducts through its class rooms.

  • There is an apportionment of Robomate which is offered to those students which will be about 25% to 30% of this fees that they pay for each of those tutorials and the test preps.

  • The company also sell robot mate as an independent package to students outside its classrooms.

  • Company’s sales value for outside students is roughly around 10,000 to 12,000 per user.

  • The company is confident about the larger acceptance of Robomate.

  • The company has sold about 9750 Robomate outside the classrooms to the independent students, which were not MT Educare students versus 2473 students done in the same quarter last year.

  • The company has so far generated five crores from Robomate.

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Mahindra CIE Q2CY18 Concall Summary

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Financial Highlights

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  • Sales have grown by 26% vis-a-vis Q1 FY-17, 10% of this growth is on account of positive exchange rate translation impact

  • The EBITDA for the India business has crossed the 15% EBITDA mark, which is good news.

  • The EBITDA has thus grown by 49% versus first quarter CY ‘17, EBIT has grown by 71%, and the EBT has grown by 88%.

  • Company has managed to maintain EBITDA margins as compared to Q1 FY17.

  • In absolute terms, EBITDA has grown 27% versus Q1 C ‘17, EBIT by 35%, and EBT by 46%.

  • In the consolidated results which are a combination of the positive evolution in both India and Europe, there has been a 26% growth in revenue, 36% growth in EBITDA, 50% growth in EBIT, and 62% growth in EBT when compared with the same quarter of last year.

  • The consolidated EBITDA margin is at 13.8% from Q1 CY ‘18 compared to 12.8% in Q1 FY ‘17s.

  • In Europe total impact of the steel price increase that is about 1% on EBITDA margin.

  • Company had around 10 odd Crores of currency impact that came on account of the unit of Bill Forge, Mexico. There is a loan in Mexico which is dollar denomination and the local currency strengthening is what has resulted in this exchange gain.

  • The full-year run rate is 30 million

  • The total revenue size of roughly 1900 Crore per quarter consolidated and for Europe it is 1100 plus and it is 700 plus for India.

  • Impact on margins of commodity price is about 100 basis point.

  • The European operations have hit €140 million mark this quarter.

  • India business now along with Bill Forge crossed the 15% EBITDA margin this quarter.

  • In the Europe, out of the 26% growth, 10% would be currency related and 2% would be the commodity price related, so volume growth is 14%.

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India Business 

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  • The India business has grown by 24%. All divisions in India have seen healthy growth.

  • The main drivers of growth in India has been the positive market evolution in UV, tractors, and two wheelers as well as the growth at some key customers.

  • The revenue growth has also been augmented by favourable raw material and scrap prices. The European growth, if you adjust for the currency impact, it is about 16% growth.

  • There has been a 24% growth in the India business and somewhere around 3% to 4% would be because of the Steel price increase, the rest would be all organic and volumes.

  • For the India part, their growth is almost 12%, 4% is explained by the steel cost inflation and the rest is because other key customers have grown faster than the industry.

  • The weighted average growth of key customers would be about 18.5%.

Metalcastello

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  • Metalcastello is growing at a tremendous pace mainly because company got a new program coming from the customer Caterpillar all the transition were made during last year

  • They have already started the production, so the jump in Metalcastello is 45% growth in last quarter 2018.

 Forging business

  • German Forgings had seen a growth of around 10 odd percent. This growth is coming especially because all the customers, most of them are European truck makers, Scania, DAF, MAN,

  • Daimler and those companies they are exporting a lot to the States, the truck business in the States is booming right now.

  • This is one of the explanation why company is receiving so many orders from the customers. Second impact is that this technology is quite mature technology and some of our competitors are failing in the market, so there is a concentration in the biggest client, in the most reliable company, so company is getting benefit.

  • The castings, forgings, and Bill Forge are the best performing, fastest growing divisions, but the others are also growing above double digits, so overall it is balanced

  • The Lithuanian crankshaft business growth is approximately €15 million, it is the growth that are coming from there annualized, and regarding the growth increase in Metalcastello excluding the exchange rate the impact has been 35%.

  • MFE (German Forgings) is growing at 10% and is growing in production. In Euros it is 10%, it is 35 in Metalcastello, and something like 16% in the car passenger roughly.

  • Growth of the Bill Forge in constant is 25% plus.

New investments

  • The CAPEX guidance is 5% to 6% of sales that includes both maintenance and growth.

  • The amount of capex for this year is Rs. 4 million.

  • Mexico plant is a new factory with new machinery, new people and it is done to cope with the demand

  • One new press has been set up in Mexico and in approximately nine months or eight months, it will start the production with another customer

  • In India, management is investing heavily to solvebottleneck in terms of production to continue growing

  • The company made an investment approximately 300 crores last year and for this year, management expects to go up to 400 Crores of investments

  • There has been advancements of the gear business, it is fully booked right now and management is advancing 2019 investment to 2018 i.e. moving ahead the investment.

  • The forgings, Bill Forge, management is adding a couple of presses in order to continue with the supply to the customers that they are increasing every month and the company will be adding new capacity in all the profitable businesses where there is customer demand

Production/capacity utilisation

  • The production in the casting wing per month where it was about 3500 ,over passed the 4000 tons and the same situation in the forging

  • The utilization level right now at an average would be at 90% more or less. Certain divisions have 25% free capacity and some, for e.g. Bill Forge are fully booked i.e. they are 100% utilised, so overall average capacity utilisation is 90%

Management expectations

  • For Bill Forge, Mexico, the peak expected revenue is $30-$35 million.

  • The company will start the ramp up of the new customer project in Mexico by beginning next year.

  • The ramp up of current 15 customers will be at the peak volumes by the end of this year, so in 18 months more or less, expectations will reach approximately that level.

  • Germany business is not really profitable business, it is below the standard. Management does not plan to continue invest in that and are only making maintenance CAPEX in Germany operation and the idea is to fulfill the capacity, maximize the resource, and do not invest in development in those company

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Aegis Logistics Q1FY19 Concall Summary

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Financial Performance:

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  • Q1 FY19 was very promising quarter for Aegis Logistics Limited

  • Aegis Logistics recorded excellent Operating Performance in Q1FY19 but slightly higher tax rate compared to FY18 cut the Profit After Tax margin

 Segment wise results

Liquid Terminal Division:

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  • Revenue for Q1FY19 were INR 45.45 crores as compared to INR 42.69 crores Q1 FY18. This is about 6% Y-o-Y increase in revenues

  • EBITDA for Q1FY19 was INR 28.88 crores versus INR 27.85 crores in Q1 FY18. This corresponds to a rise of 4% Y-o-Y.

New Terminal Projects:

  • Kandla liquid terminal, a 100,000 kiloliter project, is operational from Q1, and Aegis Logistics expect revenues to kick in from Q3 onwards.

  • Management expects to complete the Mangalore project, a 25,000 kiloliters, in Q2FY19. This will add to the revenues in Q3.

  • The Haldia 4 liquid terminal project, 35,000 kiloliters, is also expected to be complete in Q2.

  • Aegis Logistics expects a significant boost to the revenues and earnings in Liquid Terminals division in the second half of the FY19

Gas Terminal Division

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  • Revenues for Q1FY19 were INR 971.4 crores as compared to INR 813.3 crores in Q1FY18.

  • The EBITDA for the Q1 for Gas Terminal Division was INR 62.2 crores versus INR 38.9 crores in Q1FY18. This is very strong rise of 60% year-on-year.

Volume analysis
 

LPG Volumes

  • The LPG volumes, throughput volumes, logistics volumes in Aegis Logistics’ three terminals of Bombay, Pipa and Haldia, was 576,468 metric tons in Q1FY19 as compared to that of 301,571 metric tons in Q1FY18.

  • That's a stunning rise of 91% year-on-year in the LPG logistics volumes in those 3 terminals.

  • Reason for this massive rise lies in operational efficiency of Haldia Plant.

  • Haldia Plant was budgeted to run at 125000 Metric tons per Quarter, but plant has already reached run rate of 200000 metric tons per quarter. This is about 60% higher than budget.

 Packed Cylinder Volumes

  • Packed Cylinder volumes for the commercial cylinder market were also good 3,900 metric tons for Q1FY19 as compared to that of 2,946 metric tons in Q1FY18. That's a rise of 32% YoY.

 Industrial bulk LPG volumes:

  • Industrial bulk LPG sales for Q1FY19 was 11,031 metric tons versus that of 8,836 metric tons in Q1FY18, a rise of 25% Y-o-Y.

 Auto-gas Volume

  • Autogas constitutes 6,895 metric tons of volume for Q1FY19 as compared to that of 6,204 metric tons in Q1FY18, a pleasing rise of 11% year-on-year.

  • Sourcing volumes for LPG for AGI in Singapore was 215,849 metric tons versus 285,094 in Q1 FY18. There was a drop of 24% YoY.

  • This is due to BPCL, power petroleum, did not come out with a tender for 2018, although Aegis Logistics did the same in August.

Dividend Announcement:

  • Aegis Logistics declared a final dividend of INR 0.75 per share.

  • Along with the interim dividend earlier in the year, the total dividend for the year, interim plus final dividend, for financial year 2018 was INR 1.25 a share versus INR 1.05 a share in the previous year.

Further expansion in LPG division Road map

  • Aegis is working on 2 deals in the West Coast of India, to different ports in the West Coast

  • First step is to take environmental permissions and explosives permissions, which means that AGI have layouts approved for expansion in West Coast

  • Aegis Logistics is negotiating the commercial deals with the oil companies. And might end up with 3 oil companies being major users of buoy.

  • Management expects to complete all necessary approvals by end of Q1 and Q2 of FY20 and after that 18 months of construction period

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ICICI Prudential Insurance Q1FY19 Concall Summary

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Organizational Structure

  • NS Kannan has been appointed as MD of the company effective June 19, 2018 subject to IRDAI approval.
  • Punnet Nanda has been promoted as Deputy Managing Director of the company.
  • 94 of the top 113 managers have been with the organization for more than 10 years.
  • Company boasts a strength of 17,000+ employees.

Strategy & Performance

  • Focus continues to be on growth of absolute Value of New Business (VNB)
  • The path to growth is reflected in 4 Ps of “Premium growth”, “Protection focus”, “Persistency improvement” and “Productivity enhancement”

Premium Growth

  • Range of product have been increased to ensure customers’ on-boarding and service through distribution architecture.
  • A diverse distribution architecture helped translate product and service into business.
  • Even with growth in new business, Annualized Premium Equivalent (APE) has declined by 18.1% and market share being 11.3%

Protection Focus

  • Nuclear families are growing and need to protect loved ones from losing family income is on the rise.
  • Retail customers are borrowing to make assets and need to secure them through insurance.
  • The company is devising solutions and products to cater to this need.
  • The protection APE growth was 48.1%, with protection accounting for 8.2% of APE.

Persistency Improvement

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  • Customer retention has improved by changing the organization and partner culture.
  • Customer retention actually creates profitability to the company and is best parameter to gauge customer experience.
  • The efforts to increase customer retention led to 13% growth in total premium and 29% growth in yearly retain renewal. Also, 13th month persistency was 85.8%.
  • 49th persistency has also improved to 63.7% from 59.2%

Productivity enhancement

  • Focus was on technology and re-engineering to improve on expense ratios. But, increasing focus on protection will lead to increment in cost ratios.
  • Expense ratio for the saving business was at 13.7% mainly due to decline in the business

VNB Growth

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  •  The Value of New Business for Q1-2019 was Rs. 2.44 billion with a margin of 17.5%.
  • The growth in VNB was 34.1% even with the decline of 18.1% in APE
  • The growth would be led by rising working population and increasing per capita income for both savings and protection businesses.

Retail Focus

  • Retail business accounts for 96% of new business APE. It has marginally reduced because of increase in group protection business.
  • Total AUM growth in the quarter was 12.7% to Rs. 1.43 trillion. Retail AUM constituted of Rs. 1.28 trillion, i.e. 89% of the total AUM
  • Private market share continues to be around 21.0%. Whereas total market share of 11.3% was a decline from 11.8% in FY 2018.
  • The first 2 months of FY 2019 saw 30% decline in RWRP numbers because of strong first-quarter in last year due to demonetization.
  • RWRP numbers for June were 36% higher than that of May.
  • Year-on-year decline was low at -5%.

Multi-Channel Distribution

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  • Non-bank channels contributed to almost 45% of APE.
  • Different channels like agency, bancassurance partnerships, proprietary sales force, corporate agents and brokers including web aggregators have been developed.

Customer centric Products

  • ULIP were focal point in delivering lower cost and lower persistency risk to customer while offering transparency.
  • Individual life/health, credit cover, and group life are three key segments of protection all of which saw growth in Q1-FT2019

Productivity Cost

  • Cost to TWRP ratio was Q1-FY2019 as compared to 14.2% for Q1-FY2018.
  • Cost to TWRP for saving business was 13.7% compared to 12.5% for Q1-FY2018.
  • Commission Ratio is stable at 5.5% is stable and is higher than Q1-FY2018.
  • Non-commission component of cost has gone up by 40%.
  • For Q1-FY2019, 73% if new business policies are issued within 2 days, 61% of renewal premium is receipted through electronic mediums and 99% of customer-initiated pay-outs are processes electronically.

Financial Update

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  • Total premium increased be 13% to Rs. 55.18 billion in Q1-FY2019.
  • Profit after tax for Q1-FY2019 was Rs. 2.82 billion down from Rs. 4.06 billion in Q1-FY2018
  • The decline in profit is because of increase in expenses with focus on protection business.
  • Expenses grew by 43.4% in Q1-FY2019 because of increased ads and publicity.
  • Solvency ratio continues to be a very strong number at 235%.
  • AUM grew by 12.7% to Rs. 1.43 trillion and 86% of linked portfolio has performed better than the benchmark indices
     

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Biocon Q1FY19 Concall Summary

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Key highlights

  • Biocon’s partnered biosimilar, pegfilgrastim, Fulphila, received approval from the U.S. FDA last month.
  • Biocon’s partner, Mylan, has launched the product in the U.S. as the most -- as a more affordable therapy option for cancer patients undergoing chemotherapy.
  • Biocon's sterile drug product manufacturing facility for biologics in Bengaluru received EIR from U.S. FDA and the EU GMP certification during the quarter.
  • Biocon presented PK-PD data on our Novel Insulin Tregopil at the American Diabetes Association scientific sessions in the U.S. And Syngene extended and expanded their agreement with the Baxter global R&D center until 2024.

Financial Highlights

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  • Total consolidated revenue for the quarter were INR 1,193 crores, up 21% compared to last year.
  • Revenue from operations were INR 1,124 crores, which were up 20% as compared to last year. This includes licensing income of INR 5 crores this quarter as compared to INR 8 crores in Q1 of last year.
  • Segment perspective
    • Small Molecules, the segment revenue was up 10% to INR 400 crores.
    • Biologics grew 36% to INR 250 crores and Branded Formulations grew 13% to INR 147 crores.
    • Syngene revenues were up 39% at INR 406 crores in Q1.
  • Biocon incurred gross spend of INR 88 crores on R&D this quarter, corresponding to 12% of revenues, excluding Syngene.Of this amount, INR 44 crores is reported in the P&L.
  • Biocon capitalized an amount of approximately INR 44 crores related to our biosimilars and insulin analog development expenses.
  • The gross spends are lower than last year due to timing of some of the activities on a quarterly basis. The amount in the P&L has reduced on account of capitalization of bevacizumab-related expenses, which were reflected in the P&L in Q1 of last year.
  • Biocon booked a Forex gain of INR 39 crores this quarter as compared to INR 17 crores in Q1 of last year. This gain is reflected in the other income line of the P&L. Of the total amount, INR 28 crores is coming from Biocon while the rest is attributable to Syngene.
  • Group EBITDA grew 25% to INR 307 crores, with EBITDA margins at 26%. Core margins, that is EBITDA margins net of licensing impact of ForEx and R&D, stood at 27%. Reported net profits were up 47% this quarter at INR 120 crores, which represents a net profit margin of 10%.
  • The effective tax rate at 27% for the quarter is slightly lower than last year of 28% due to lower losses in overseas subsidiaries during the period under review. 
Biocon Q1YF19 YoY performance.png

Segment-wise Analysis

Small Molecules Segment

  •  The revenue growth of this segment was led by key APIs and increased generic formulation sales.
  • Higher sales of immuno-suppressants and increased market share of Rosuvastatin formulation in the U.S. were key contributors.
  • Biocon also launched simvastatin tablets in the U.S. market during the quarter.
  • Several drug multipliers were filed in developed and key emerging markets during the quarter, centering on Small Molecule's API pipeline

Biologics

  • This segment was led by higher sales of biosimilar monoclonal antibodies in emerging markets, supported by the Insulin business
  • The primary driver for growth this quarter was trastuzumab with strong retail market uptake witnessed in Brazil and robust market shares in certain markets in the [LATMEX] region
  • Biocon’s Insulins portfolio continue to improve its market share in several emerging markets
  • The recent launch of pegfilgrastim by Biocon’s  partner, Mylan, in the U.S. and Insulin Glargine sales in EU and Australia, which are planned for later this fiscal, are expected to provide a further tailwind to this segment performance.
  • Biocon is confident of achieving the $200 million target revenue for this segment in FY '19.

Branded Formulations Segment

  • In Q1, the growth in Branded Formulations segment, which comprises product sales in India and U.A.E, was led by growth in the India Branded Formulations business.
  • India Business
    • The India business growth this quarter benefited from the lower base last year in the same quarter due to GST implementation. Metabolics, Nephrology, Immunotherapy and Comprehensive Care divisions aided the business performance with strong growth reported for some of our key brands.
  • UAE Business
    • In the U.A.E., the business continue to garner market share in the Metabolics segment to increase sale of in-licensed products of Insulin Glargine, which was introduced recently.

Syngene

  • In terms of research services, Syngene recorded a strong growth this quarter.
  • The growth was driven by good performances within biologics manufacturing, discovery services and chem dev services.
  • Syngene also announced the extension and expansion of their agreement with the Baxter global R&D center until 2024. They also announced the recommissioning of Phase I of the upgraded [S2] facility, which was damaged due to a fire incident in December 2016. The progress made provides good visibility on underlying growth expectations for Syngene for this year and the long term.

Product development updates

  • In Europe, the regulatory review of Biocon’s Marketing Authorization Applications or MAA for biosimilar trastuzumab and pegfilgrastim are progressing well, and the decision by CHMP is expected by the end of calendar year 2018.
  • For the U.S. market, Biocon and Mylan are generating additional clinical data for Insulin Glargine in support of the manufacturing site change from Bengaluru to Malaysia.
  • As part of Biocon’s novel molecule portfolio development program for Insulin Tregopil, our oral insulin candidate. Insulin Tregopil advanced in pivotal Phase II, Phase III study in Type II diabetes with more patients in India being randomized during the quarter.

Business updates for Q1FY19

  • Biocon able to increase sales in the Small Molecules segment despite challenges persisting in the generics industry.
  • Branded Formulations also grew in double digits, and a better performance expected  from this segment this year.
  • The growth segments, namely Biologics and Syngene, have made a strong start building upon the traction from last quarter.
  • Recent and upcoming launches of biosimilars, coupled with traction in the research services, provide us a good launch pad to accelerate growth in the subsequent quarters during this financial year.

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Indusind Q1FY19 Concall Summary

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Banking Industry Developments:

  • Major event was increase of 50 basis points in G-secs rate. As a result, bond portfolios of banks were severely hit especially trading portfolios in money market and G-secs.
  • Monetary policy change led to hike of 25 basis points.
  • Rupee depreciated about 5% in the quarter itself leading to more volatility that presented an opportunity to offset the MTM hits that bank got.
  • For large borrowers, RBI introduced fixed loan component out of the working capital limits and the undrawn portion will have a 20% credit conversion factor.
  • Minimum Support prices were raised which lead to increase in inflation by 25 basis points.

Financial Results:

Indusind Q1FY19 Profit and Loss.png
  • Growth in Net Interest Income is 6% and loans is 4% q-o-q basis.
  • Growth in Net Interest Income is 20% and loans is 29% y-o-y basis.
  • Revenue Growth and net profit growth is 6% and 9% respectively.
  • Loan book growth was 29% year-on-year and 4% q-o-q where 30% growth in corporate loans and 28% growth in vehicle finance and non-vehicle retail businesses.
  • Above mentioned 29% growth is in spite of Rs. 8000 crores that were sold from corporate book.
  • CASA growth rate was 37% y-o-y basis, of which SA growth was 51%.
  • ROA growth was from 1.86% to 1.91%.
  • ROE has grown to 17.25%.
  • Cost-to-income ratio has gone down close to 44%.
  • Earnings per share has also gone up to annualized Rs. 69.
  • Net Interest Margin went down by 5 basis points.
  • Credit cost shrank from 19 basis points to 14 basis points.
  • The ARC book, SR book is at 33 basis points
  • The Weighted average Risk score (WARS) for vehicle portfolio of this quarter is 1.77 (1 being the best), indicating that credit cost will slightly improve in next few quarters.
  • The trading gains is Rs. 137 crores (fee line)
  • Net gains are Rs. 51 crores
  • Fee income has grown by 20%, but total free has grown by lower than that because of the fall in trading gains. Total fee is down from Rs. 181 crores to Rs. 111 crores because of that.
  • Core fee has grown y-o-y and q-o-q basis
  • Foreign exchange incomer has grown by 16%.
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Asset Quality

Indusind Q1FY19 NPA.png
  • Gross NPA is 1.15% which is lowest in industry.
  • Restructured book is lowest among industry at 5 basis points
  • Provisions absorbed the Rs. 86 crores mark to market quarter end loss
  • Slippages reduced from 2.68% to 1.31%
  • Provision coverage ratio is maintained at 56%.

Customer Base and Branch Growth:

  • Customer base is 12 million
  • 1 million new customers were added during the last quarter
  • 10 new branches are work in progress
  • Around 200 branches are on track to be opened in the full year

Mergers and Acquisition:

  • The acquisition of ISSL, ILFS Securities and Services Limited is signed and should be closed in this quarter
  • Bharat Financial merger is in its final leg and next step in to take approval from NCLT

Cost of Funds and Yield :

Indusind Q1FY19 Yield Cost Movement.png
  • Cost of deposit went up 22 basis points and cost of funds went up 35 basis points
  • Yield on asset went up by 30 basis points leading to NIM going down by 5%
  • Corporate yield has improved by 9 basis points and consumer yield has gone up by 4 basis points

Capital Consumption:

  • Risk-weighted asset to total asset ratio in last two years this quarter was 76% and 78% respectively, while it is 80% now.
  • Growth in credit risk RWAA is 6.12% q-o-y vs. 3.3% loan book growth
  • 33 base points comprise of 8 base points because of dividend payment and 25 base points on account of loan book growth which is BAU

Distribution Fees:

  • Distribution fees has gone up by 30% y-o-y basis
  • This is because of momentum for insurance and investment business
  • The fees also incorporate housing loans disbursal for HDFC

Vehicle Finance Market:

Indusind Q1FY19 Vehincle Finance Portfolio.png
  • Vehicle improvement is there in terms of freight rates and freight availability
  • Finance market is only 20% for two wheelers, rest 80% are in cash or credit cards
  • IndusInd Bank closes around 70,000 to 75,000 vehicles per month

Current Account Growth:

  • CA business growth is 2-3% only in over five quarters
  • Acquisitions need to be made to increase throughput to 20,000 from current 8,000-9,000 because of low average ticket size (Rs. 50,000 to Rs. 60,000)
  • The reason for slow growth is advancement in payments space and cash management space

OPEX Growth:

  • OPEX growth has been arrested to a low number even after opening 200 branches
  • Main reason is digitization related productivity gains leading to Rs. 200 crores being saved annually
  • Business has grown by 25-30% even after reducing headcount by 300
  • Cost to income ratio is targeted to be around 44%

Saving and Government Deposits:

  • Government deposits are 15% to 20% of overall balance sheet
  • SA will continue to grow at a stable rate.
  • Currently, 1,25,000 accounts are there and target is of 1,50,000

Home Markets:

  • Moving from 16 markets today to 18 this year

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Symphony Q1FY19 Concall Summary

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Key Performance Figures:

  • •Revenues declined from ₹ 190 Cr to ₹ 146 Cr. (drop of over 23%) for the Quarter ended on June’18 [Consolidated]
  • EBITDA dropped over 50% from ₹ 47 Cr. to ₹ 23 Cr. {June’18 Quarter}
  • PAT dropped from ₹ 39 Cr. to ₹ 21 Cr. a drop of about 48% in Q1FY19
  • Efficacy of Capital employed has improved from ₹ 152 Cr. to ₹ 189 Cr qoq 
  • International Business is unaffected at ₹ 80 Cr, same as the last year, for the same quarter
  • Domestic Business dropped from ₹ 110 Cr. to ₹ 65 Cr. on a Standalone alone basis 
  • Treasury, Cash & Cash Equivalents are up from ₹ 351 Cr. to ₹ 449 Cr. 
  • Treasury, Cash & Cash Equivalents are the only parameters that have shown growth in Q1FY19
  • Company would be reporting the Consolidated performance on a quarterly basis starting June’18 Quarte
  • Gross margin remained more or less same through the quarter, however the drop-in profits was due to the reduced top-line.  
  • In the Dec Quarter, the profitability was in excess of 20%

Mexico Updates

  • In Mexico, the topline in Mexican peso has increased from MXN 109 million to MXN 123 million
  • IMPCO ha made profits of INR 12 Cr. & that of the China subsidiary has made profits of INR 3 Cr.

Acquisition of Climate Technologies

  • Symphony had recently completed the acquisition of Climate Technologies w.e.f July 1st 2018.
  • Climate Technologies was acquired at valuation of 40 million AUD which is expected to grow to 44 million AUD i.e INR 210 Cr
  • For FY18, Climate Technologies topline was $ 55 million with EBITDA of $ 5.5 million, which amounts to topline of INR 275 Cr & EBITDA of INR 30 Cr. & PAT of INR 23 Cr. on translation
  • Overall the acquisition translates to EBITDA multiple of 7.33x, while the sales multiple is 1x
  • The acquisition was funded by 60% long term debt of AUD & remaining 40% which is 15 million AUD is via equity. 
  • Climate Technologies is expected to generate ROCE of approx. 20% 
  • Climate Technologies is expected to register gains of $ 65 million in 2018 
  • By 2021, Climate Technologies topline is expected to grow to $ 80 million
  • Climate Technologies market share in Australia is close to 35%

Business Updates

  • The results were not so good primarily because of the bad summer with unexpected rains
  • The Topline in India has dropped from INR 120 Cr to INR 79 Cr. 
  • However, the ad expense has remained more or less constant at 21 Cr. approx.
  • Symphony was able to maintain it’s market share despite the overall market size drop
  •  As per the estimates, the branded cooler market would have definitely grown by about 15%. Markets in India and China are fragmented
  • In the last quarter, GST has registered the profit of almost INR 3 Cr.
  •  The company has created its subsidiary in Australia
  • Under Version 3.0, there is good opportunity of savings in Symphony’s range of residential coolers through Climate Technologies

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Info Edge (India) Q1FY19 Concall Summary

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Q1 FY19 Results - Stand-alone financials

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  • Billings in Q1 were INR 283.3 crores, up 17% year-on-year.
  • Revenue in Q1 was INR 259.5 crores, up 17% year-on-year.
  • Operating expenses excluding depreciation for the quarter were INR 175.3 crores, up 15% year-on-year primarily due to an increase in marketing, hiring in certain products and annual increments
  • Operating EBITDA stood at INR 84.3 crores versus INR 70.3 crores last year, having increased 20% year-on-year.
  • Operating EBITDA margin for the quarter stood at 32.5% versus 31.6% in Q1 of last year.
  • EBITDA adjusted for ESOP noncash charges stood at INR 88.1 crores versus INR 79 crores last year
  • Adjusted EBITDA margin for the quarter stood at 34%.
  • Cash EBITDA for the quarter stood at INR 112 crores, up 14.2% year-on-year.
  • Deferred sales revenue has increased to INR 420 crores as of June 30, 2018, versus INR 354 crores as of June 30, 2017, an increase of 19% year-on-year.
  • The cash balance for the company as a whole stands at INR 1,980 crores as of June 30, 2018
  • The recruitment business and the real estate business continued to drive the growth for the quarter.
  • Expenses
  • Spent more on marketing as compared to Q1 of last year,
  • Hired additional resources to invest in changing technologies.

Results by segment

Recruitment segment.

  • Recruitment segment billings in Q1 were INR 210 crores, up 15.4% year-on-year.
  • Revenues were INR 184.1 crores, an increase of 15.2% year-on-year.
  • Operating EBITDA margins in recruitment segment were at 56.8% versus 55% in Q1 FY '18.
  • Employee costs were higher because of increments and some net hiring in the division.
  • EBITDA margins adjusted for ESOP noncash charges stood at 57.8%.
  • Cash EBITDA for recruitment during the quarter stood at INR 132 crores, up 15.6% year-on-year.

Naukri

  • Added an average of 18,000 fresh CVs every day in Q1.
  • Naukri database grew to about 59 million CVs.
  • Average CV modifications were [350,000] per day.
  • Traffic share in the job portal space continues to be in the mid-70s excluding Indeed and around 60% including Indeed.
  • Investment in recruitment tools and systems business continues aggressively.

Industry-wise trend

  • There was an uptick in new customer acquisition last quarter, and there was also some pickup in IT sector hiring, leading to higher billing from IT companies this quarter.
  • Non-IT companies -- sectors like auto, industrial products, construction, banking, finance, insurance, manufacturing, BPO and some other smaller sectors also did well for the company in terms of growth as also indicated by the Naukri JobSpeak index.
  • Revenue from consultants did not grow as expected.
    • 27%-28% of our revenue comes from IT companies
    • Another 25%-26% of our revenue comes from recruitment firms
    • And then all the rest comes from another 40-50 industries.

Key Investment areas in Naukri

  • Whole mobile piece and for the personalized user experience on app.
  • Enterprise applicant tracking and regular management space.
  • Data science group and a machine learning group to leverage these technologies to improve our machine capabilities.
  • Incremental improvements on product.

Real estate business - 99acres

  • In the real estate business, 99acres, billings in Q1 grew 39% year-on-year to INR 41 crores. Revenue grew 34% to INR 42 crores.
  • Continued investment in marketing during the quarter, resulting in an EBITDA loss of around INR 11.5 crores versus a loss of INR 9.6 crores in Q1 of last yeare
  • Adjusted EBITDA after adjusting for ESOP expenses stood at a loss of INR 10.7 crores versus a loss of INR 7.1 crores in Q1 of last year.
  • Cash EBITDA loss in 99acres during the quarter stood at INR 11.7 crores versus a loss of INR 8.7 crores in Q1 of last year
  • Our traffic share amongst real estate portals remained around 60% during the quarter based on time spent as per SimilarWeb.
  • Broker billings form 50% of the overall billings, while builder billings stood at about 45% of the billings for the trailing 12 months ending June 30, 2018.
  • Homebuyers continue to prefer retail and rental properties over new launches which was evident from higher Q1 billing growth on account of agents.
  • Owner billings stood at about 5% of total billings for the last 12 months.
  • Key investment areas
    • Continued investment in marketing for 99acres to consolidate position in real estate classified business
    • More investment in products and technology.

Matrimony business - Jeevansathi

  • Jeevansathi billings grew 1% year-on-year in Q1 to INR 18.2 crores, owing to aggressive pricing and activity by competition during the quarter.
  • Revenue grew 4% year-on-year to INR 18.6 crores.
  • Higher marketing expenses in the quarter aided higher traction as number of paid transactions improved year-on-year.
  • Operating EBITDA loss in Jeevansathi increased to INR 5.6 crores in Q1 FY '19 from INR 4.1 crores in Q1 FY '18.
  • Adjusted EBITDA loss stood at INR 5.5 crores in Q1 versus a loss of INR 3.5 crores in Q1 FY '18.
  • Cash EBITDA for Jeevansathi during the quarter stood at negative INR 5.4 crores.
  • More than 90% of our users access Jeevansathi from their mobile, and the Jeevansathi mobile app continues to be the best in the category.

Shiksha business

  • In Q1, Shiksha billings grew by 22% year-on-year to INR 14.1 crores.
  • Revenue grew 11% year-on-year and reached INR 15.3 crores.
  • EBITDA profit of INR 3.1 crores in Q1 versus a profit of INR 2 crores in Q1 of last year.
  • Adjusted EBITDA profit for the quarter stood at INR 3.3 crores versus INR 2.9 crores last year.
  • Cash EBITDA was INR 2.1 crores versus INR 0.6 crores in Q1 of last year. 

Strategic investments- Policy Bazaar

  • The Policy Bazaar deal was announced in the quarter and will be concluded after statutory approval.
  • 28-30% stake in Policy Bazaar after the investments.

Information on Zomato

  • Zomato is increasingly delivering more and more of its orders through its own delivery system, which is Runnr and others, right, and less and less increasingly through third parties.
  • Zomato has 12 million orders a month run rate. Zomato expects to catch up and overtake the narrowing difference from Swiggy in a few months.
  • Expect no seasonality to ordering.
  • Zomato Gold has done very well and continues to do well.
  • Recently launched Piggybank - a loyalty program, which has within 48 hours of launch locked up a large number of subscriptions and sign-ups.

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Arman Financial Q4FY18 Concall Summary

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Financial highlights

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  • AUM grew from 190 crores to 450 crores over last year which is 120% growth y-o-y
  • The growth is attributed to competition vacuum post demonetization and expanded branch network
  • Income from operations increased to 110% previous year Q-o-Q, with two third being from microfinance side, 20% from two-wheeler side and remaining from MSME side
  • Profit this quarter was Rs. 2.43 crores are compared to loss of 74 lakhs for fourth quarter last year
  • Last year was extraordinary due to demonetization effect, but the company has continued to grow at 40% to 50% for last 8 years
  • The NIM have come down from 17.3% in 1QFY2018 to 13.2% in 4QFY2018, the reason being that the companyhas now become almost completely leveraged for its Tier 1 and Tier 2 requirements

Equity

  • SAP has invested 50 crores in the form of CCD
  • It will be converted into ordinary equity after 18 months
  • The purpose of this funding is to decrease over all interest cost, better rating from credit rating agency and manage risk

MFI business 

  • Disbursements was 400 crores this category for completeyear
  • Company plans to foray into Rajasthan for MFI operation
  • Company is using aggressive write-off policy to take tax benefits
  • Average loan size in UP is Rs 18000 and 100% of the disbursements are cashless
  • Company is unique in having dedicated recovery staff in those branches where there are recovery problems
  • Next year target will be about 400 crores to 450 crores AUM in this category
  • Collection efficiency post-demonetisation is about 99.42%
  • Operating expense is 8.5%
  • Currently, there is not a lot of pricing pressure in this business, but it is more about timely delivery of funds that is important to customers of this segment
  • Company sees lots of opportunities in UP and hence it is going to open around 20 branches there in next year

Two-Wheeler segment 

  • Disbursements was 484 crores this category for the year
  • Next year’s target would be around Rs 90 crores to Rs 100 crores AUM in this category
  • Operating expense in close to 6% to 6.5%

MSME Segment 

  • Disbursements was 46 crores this category for the year
  • Company plans to start Loan against property product
  • Next year target would be around Rs 100 crores plus another Rs 25 crores to Rs crores from LAP
  • Operating expense is about 10% to 11%
  • The product is priced such as to achieve margin of 3%
  • The target group for this product is people with well-established businesses who are unbanked at the moment

Write-off/Provisions

  • Increase in provision was Rs 87 lakhs for standard assets because of increased asset size for this quarter
  • Write-off was Rs 87 lakhs for this quarter

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Aegis Logistics Q4FY18 Concall Summary

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Financial Highlights

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  • Total revenues for the financial year ending 2018 March were Rs. 4,791 crores versus Rs. 3,939 crores in FY17
  • A rise of 22% for consolidated Aegis group revenues seen
  • Total EBITDA for FY18 was Rs. 306 crores versus Rs. 247 crores in FY17, rise of 24% year-on-year. 
  • Profit after tax for the group was Rs. 214 crores versus Rs. 136 crores in FY17, a rise of 57%
  • Earnings per share reached Rs. 6.38 for the year versus Rs. 3.97 in FY17, a rise of 61%
  • Board has approved a Rs. 75 paisa final dividend
  • Total dividend for the year to Rs. 1.25 per share

Business Updates

  • Very strong growth in imports over the next 10 or 15 years
  • Domestic production is operating at full capacity right now
  • All the refineries have the full capacity of LPG right now
  • Domestic production of LPG always will be less expensive than imports
  • Aegis is at the full domestic production of LPG, 
  • There might be some small debottlenecking of refineries, etc. 
  • Already seeing rising imports from the oil companies
  • Trend is clear for rising imports 
  •  Expect to maintain the throughput volumes in Pipavav and Mumbai terminals and more Autogas stations are in the pipeline

Liquid Terminal division

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  • The revenues for the year reached a record Rs. 168 crores versus Rs. 154 crores in FY17. Saw a rise of 9% year-on-year
  • The EBITDA for the year for the division was Rs. 103 crores versus Rs. 91 crores in FY17. A rise of 13% year-on-year
  • Steady overall performance for this division.
  • The future growth will depend on new capacity, in Kandla, Haldia, and Mangalore 

Gas Terminal division

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  • Revenue for the year was Rs. 4,622 crores versus Rs. 3,776 crores in FY17
  • The EBITDA for the division for the year was Rs. 203 crores versus Rs. 156 crores in FY17. A year-on-year rise of 30% in the EBITDA
  • Expect a major boost to the LPG terminal volumes in FY 2019
  • Due to full year operations of the Haldia terminal
  • Haldia terminal was commissioned in Q3 of FY 2018
  • In FY 2019, full year benefit of the Haldia sales volumes will be seen
  • Sales volumes are currently running far above the budget in Haldia. 
  • The one year budget was mentioned to be around 0.5 million tonnes. That would be the full year annualized budget for sales volumes in Haldia. 

LPG volumes

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  • Most important segment in the LPG volumes is the LPG throughput terminal logistics volumes
  • For the year it was 1,742,467 metric tonnes versus in FY17 reached 1,349,899 metric tonnes
  • A rise of 29% in the volumes of LPG handled at the 3 terminals in Mumbai, Haldia and Pipavav
  • LPG sourcing volumes for the year were 1,176,598 metric tonnes versus in FY17 1,043,067 metric tonnes, a rise of 13%
  • The Packed LPG Commercial Cylinder business was 13,504 metric tonnes for the year versus 12,521 metric tonnes in FY17, a rise of 8%
  • Bulk industrial distribution sales of LPG was 40,232 metric tonnes versus 23,539 metric tonnes in FY17, a rise of 71% 
  • Autogas was 24,150 metric tonnes for the year versus 23,217 metric tonnes in FY17, a rise of 4% 
  • Key driver of rising LPG profit in the division was the LPG terminal logistics volumes 

    Autogas Stations

    • All new stations of Autogas are unified petrol, diesel under the Essar brand and Aegis Autogas - Aegis Auto LPG.
    • New stations constructing are selling petrol, diesel under the Essar brand as well as Aegis Autogas. 
    • Dealers are selling 3 products rather than 1
    • Around 11 of the old 107 stations have already been petrol
    • Diesel has already been added and continuing to see each of the current 107 stations more can be petrol and diesel. The main benefit is that getting more traffic in the station
    • Apart from LPG, petrol and diesel vehicles also coming through
    • That is the focus for the future that all new Autogas stations of Aegis are under unified stations
    • In the Essar petrol stations around 5 or 6 of Aegis Autogas pumps have been put
    • A limited amount the main focus will be on our all Autogas network to put Essar branded petrol and diesel

      Top-Line Growth

      • It is misleading because international LPG prices go up and down
      • Focus should be on actual metric tonnes rather than LPG prices because they go up and down
      • In Q1 because of rising oil prices and gas prices a sudden jump is there 

      LPG import

      • There are fluctuations from time-to-time in import volumes
      • Do not see that as any major trend, major change in trend
      • The trend is very strong import growth continued for the year because of the penetration of LPG rising in the rural areas under the Ujjwala Scheme, etc. 
      • In Aegis imports Haldia has very strong imports, etc. 
      • When the oil companies schedule their deliveries of LPG imports or domestic production, there are fluctuations with that
      • Expect continued growth, strong growth in imports

      Domestic Production

      • Fluctuates depending on the production schedule
      • Domestic production expansion will be flattish or low single-digit kind of growth
      •  There is limited capacity on domestic production
      • The incremental growth in satisfying the increased LPG demand is going to come from imports
      • Quarter-by-quarter, there are sometimes fluctuations
      • Trend is very strong growth in imports as the Government of India continues to increase penetration particularly in the rural areas of LPG

      LPG prices

      • International LPG prices are rising
      • Impact on demand is not there due to LPG prices rising
      • Even though prices are rising, they are still from a fairly low base
      • Demand continues to be strong and expect that to continue.

      Competition

      • Mundra is active on building an LPG terminal.
      • There is enough imports which are projected to happen in West Coast India
      • Going to continue to build for that

      Liquid profitability

      • Different product mixes, chemicals, depends on trade flows
      • Sometimes the more chemicals are bought which are higher values, sometimes more bulk petroleum
      • Should not think too much into quarter-by-quarter figures of operating profit
      • It remains a steady basis
      • Until new capacity on stream,it is a steady business
      • The terminals of Mumbai, Kochi, Haldia are all full and operating at full capacity
      • Pipavav remains at roughly around 20% capacity utilization, that has not changed
      • It is a steady business and there are fluctuations
      • Focus for the future is bringing the new capacity of 100,000 kiloliters in Kandla
      • There is 25,000 kiloliters in Mangalore and the capacity expansion in Haldia of 35,000 kiloliters
      • Full operation in FY 2019 that will significantly add to revenues and profit
      • Gave Liquid terminal marketing team a very demanding target for the next 2 years in terms of revenues 

      Haldia LPG pipeline

      • Latest information is IOC is making good progress on that pipeline that this is the Paradip to Durgapur pipeline via Haldia, 
      • They are making good progress on that pipeline
      • Achieving 2.5 million metric tonnes is not dependent on that pipeline
      • Aegis can handle 2.5 million tonnes both by road and some other work to be done on future Rail movement of LPG
      • Pipeline will come and that will only enhance evacuation possibility
      • HPCL is building the largest bottling plant in Asia in Panagarh
      • They are actually very close to completing that bottling plant
      • Is great news for our progress towards that 2.5 million tonnes figure
      • Still have to lay pipelines from the Panagarh to Haldia terminal which they have committed
      • They have still not even started working on that
      • Aegis can still move by road LPG to that bottling plan
      • After 6 months of operation in Haldia Aegis is so far above the budget in Haldia
      • It is primarily HPCL and there is also BPCL cargoes which are coming in
      • They have completely stopped transporting any LPG from Vizag all the way to the Northeast
      • BPCL is also bringing good cargoes into Haldia. 
      • Growth in Haldia in this year is going to power Aegis earning overall as we have said but much above budget
      • Current run rate is far above the budget far above
      • Figure will be talking about between 3 years to 5 years from start of operation

      Pipavav Liquid Terminal

      • Focus has now shifted to Rail movement of LPG from Pipavav
      • Have been negotiating with Gujarat Pipavav Port
      • Decided that was the priority rather than Liquid Rail movement
      • There is a lot of scope for increased LPG throughput movement by Rail in Pipavav
      • Once contract agreement is signed with Gujarat Pipavav on LPG Rail movement, will again talk to them about Liquid Rail movement
      • Expansion was completed some quarters ago and it is going very well
      • Maintaining good volumes in Pipavav and utilizing all the tanks that put up to in storage.
      •  Also storing other gases like butylene for Reliance in Pipavav
      • Can add another 2-3, 4 but it is always dependent on when the volumes are there
      • Breakthrough on Rail movement in Pipavav would then determine the future.

        Mumbai Terminal 

        • The throughput volumes cannot increase beyond 1.1 million tonnes
        • Everything is on road transport except for the Reliance contract on propane which goes to the pipeline because there is only road tankers can be handled on a daily basis
        • That is the current run rate that doing right now in FY 2019
        • Chakan pipeline is completed to Poona can start moving products in that 1.2 million tonne capacity pipeline
        • That is the only way the company can raise the throughput in Bombay (Mumbai) towards 1.4 million tonnes
        • Completed interconnection of 2.8 kilometers in December 2016

        Timeline On The New Terminal In The West Coast

        • There is no timeline
        • Going for meetings and negotiations on deals are happening
        • Take time because these are very-very large projects deal 

          Demand CAGR

          • Expect to be somewhere between 6% to 8% demand growth
          • Areas like Northeast, it is going to be higher because the penetration is lower
          • Being governed by how fast the public sector companies IOC, HPCL, BPCL are building out that rural penetration distribution network in the Ujjwala Scheme
          • They are growing as fast as possible 

          Aegis Logistics Market Share for Imports

          • That is a dramatic increase being talked about for the last few years which is expected to be 25% to 30% market share
          • Not only the new Haldia terminal but perhaps the next couple of deals
          • Dramatic increase from currently around 15% of handling of LPG imports to around 25% to 30% 
          • It depends on building that terminal capacity the extra terminal capacity

          Tax Rate

          • All Indian Accounting Standards has been implemented as of this year
          • Target an effective tax rate of around 20% to 22% for next financial year
          • Pretax profit irrespective of the increase in the effective tax rate will be growing well
          • Rising post-tax profit in the current year even though there is an increase in the effective tax rate.

          Future Outlook 

          Aegis Logistics Q4FY18 Liquid Capacity expansion.png
          • The growth in revenues and profits will come from the major capacity increases in the following 3 projects.
          • • Kandla   
            • First, the 100,000-kiloliter project in Kandla. 
            • Project was completed in Q4 of FY 2018
            • Project is complete, waiting for the final permission to fully start the operations.
          • •  Mangalore Port   
            • The second project is a 25,000-kiloliter project in Mangalore Port. 
            • Project should be completed in Q1 of FY 2019 and then, the final permission to start operations
          • •    Haldia
            • The third project the 35,000-kiloliter expansion in Haldia
            • Expected to complete project in the first-half of FY 2019
            • Q4FY18 was much better than Q3FY18 for Haldia port
            • Current run rate, is far above 40,000 tonnes to 50,000 tonnes per month budget
            • Budget was 0.5 million tonnes for the first full year operation
            •  3 years to 5 years is a realistic time frame to achieve 2 mn to 2.5 mn 
          • There was very good throughput in all the terminals as far as Haldia, Bombay (Mumbai), and Pipavav
          • Expect that resulting in 29% growth in overall LPG volumes in those 3 terminals
          • Will maintain the full kind of full results in Pipavav and Mumbai going ahead
          • Can increase throughput further is that Uran pipeline connection
          • Waiting for HPCL to finish their Chakan project, might be the end of calendar year 2018 to complete that project
          • Connected into that Uran pipeline some time ago but they are not using that
          • Road evacuation from the Mumbai terminal for the LPG
          • Expect greater volumes in Mumbai
          Aegis Logistics Q4FY18 LPG expansion.png
          • Growth in FY19
            • Lot of it depends on Haldia volumes
            • Bombay (Mumbai) and Pipavav to continue the current run rate which is
            • Going to be the major incremental volume growth on last year’s 1.74 million tonnes
            • The growth rate depends on whether the customers tender and whether they on their own requirements and whether they import themselves or whether they tender more
            • The company makes $3 to $4 per tonnes in Singapore
            • If IOC, HPCL, BPCL, want to bring product then bidding would be done
            • If they find that they can import themselves through the national oil companies of Saudi Aramco and others, cannot force them to come up with them
            • Main focus is how much LPG can be handled in terminal
            • FY 2019 will see continued strong growth in imports for India as a whole and in Aegis terminal
          • Scenario by FY 2020
            • The gap is rising between domestic production and domestic consumption, which means more imports
            • Gap is going to be increasing because domestic production is stagnant
            • More imports mean more terminals
            • Indian Oil is trying to build 1 terminal in Kochi, which is a 30,000 terminal
            • Got into some problems with National Green Tribunal
            • BPCL is trying to construct 1 more terminal in Haldia a 30,000 tonnes terminal which is under construction
            • Apart from those 2 public sector projects, only Aegis is building LPG terminals
            • Currently planning another 2 LPG terminals in collaboration with the public sector
            • Bulk of the incremental import capacity is going to come from either public sector or Aegis
            • India should then be able to handle the imports by FY20

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          Ujjivan Financial Services Q4FY18 Concall Summary

          Ujjivan Financial.png

          Financial Highlights

          Ujjivan Financial Q4FY18.png
          • Quarterly disbursement rose by 6% from previous quarter and 61% YoY to INR 2262 crores
          • The disbursement in the whole year grew by 13% in total to reach INR 8052 crores
          • The gross loan of the firm grew by 18.5 form March 2017
          • Firm through its operations has added 7.6 lakh new borrowers in the fiscal year
          • The share of MSE and housing finance saw twofold upsurge from the previous value of 2.4% to reach a figure of 7.3% , the major improvements came in the later part of the year
          • Net Interest income of the quarter grew by 24.8% from the previous quarter to reach INR 271.8 crores
          • Company healthy increase in the net margins which stood at 12.8 for the ending quarter up from 11.1% from the preceding quarter
          • Total credit cost of the year stood at INR 310.8 crores which was in line with the earlier predictions of the company
          • Both GNPA and NNPA of the firm has reduced since last quarter
          • The collection efficiency of the all the loans that had been passed since January 2017 is 99.6% which is good
          • Net Profit for the quarter stood at INR 64.9 crores which was considerably higher than the last quarter profits INR 29.3 crores
          • The ROA and ROE has improved since the last quarter and over the period of one year also since the last fiscal year
          • In coming three years time the company is eyeing for 33% business coming from the MFI and are expecting quarter of that to be secured loan

          Deposits

          Ujjivan Financial Services Deposits.png
          • The deposit base of the bank stood at INR 3772 crore as of March,2018 out of the total deposit base 3.7% was CASA and 11.3% were retail deposits. Company is optimistic of gaining more traction in the retail deposits
          • The company is eyeing for 25% of the total deposit base to come from the retail at the end of this fiscal year
          • Around 50% of the total loan advances in Q4 2018 were covered by the deposit base against only 36% in Q3 2018

          Microfinance Business

          • The total microfinance disbursements in the Q4 stood at INR 1910 crores
          • The loan disbursed to the individuals grew by 31.6% and also the total disbursement grew by 1.8% over the last quarter
          • The company took cautious stance after the demonetization and only those branches were given go-ahead where the efficiency of collection were higher and had returned to normalcy
          • The business in the MFI domain would ramp up in the coming fiscal year


          Cost of Funding

          • The average cost of funding the operations of the bank reduced by 140 basis point to remain at 9%, the improvement came as the strategic result of repayment of legacy loans and increasing the deposit base which was at considerably less rate of interest
          • However the cost to income ratio of the company has worsened from 53.1% in 2017 to 67.1% in 2018   
          • Company at the start of the fiscal year had legacy funding of 64% which they have repaid to some large extent
          • They are hopeful of repaying remaining 30% in the current fiscal year


          Risk Management

          • Bank has invested heavily in the risk management practices in form of KYC and AML
          • They have a dedicated team of individuals who look after the risk management
          • The credit policies and risk management practices have been formulated keeping in mind the specific type of risk faced in the branches and clusters


          Operating Expenses

          • Operating expense of in the year showed marginal increase in comparison to last year because most of the opened branches were of URC type and had very low cost impact
          • Also the company estimates of the operating costs at the beginning of the year matched significantly with the end year results
          • This year the cost to income ratio might increase by 3-4% owing to multiple branch openings


          Customers

          •  More than 60% of the customers would be with the company for more than 2 years now and another 30% could be in between 1 to 2 years
             
          Ujjivan Financial Services Strategy.png

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          Skipper Q4FY18 Concall Summary

          Skipper.png

           

          Financial Highlights

          Skipper FY18 Financial Performance.png
          • Revenue grew by 24.6% to Rs. 2074 crores
          • Net sales increased to Rs. 593 crores from Rs. 564 crores compared to corresponding quarters last year
          • EBITDA increased by 25.2% to Rs. 274.93 crores
          • Reported EBITDA increased to Rs. 108.58 crores from Rs. 101 crores in the corresponding quarter
          • Operating margin slightly increased to 13.3% as compared to 13.2% in FY17
          • PBT increased by 23.1% to Rs. 152.77 crores against Rs. 124.09 crores in FY17
          • Reported PBT and PAT numbers were at Rs. 74.08 crores and Rs. 49.53 crores respectively
          •  Board of Directors has recommended highest ever dividend of 165% for FY18
          • Requirement of Forex derivative gain to be reported on mark-to-market basis has resulted in increased profitability numbers of previous year
          Skipper Q4FY18 Financial Performance.png

          Engineering product business

          • Engineering product business continues to demonstrate robust performance 
          • Secured or favourably placed in new orders worth in excess of Rs. 620 crores for engineering products, supplies from PGCIL, SEBs, telecom and solar companies and for various supplies across Europe and Southeast Asia
          • EBIT margins jumped due to execution of some high margin contracts
          • Company will have virtual monopoly in the upgradation of Northeastern infrastructure project

          Polymer Business

          • Polymer business is expected to grow at around 40% in coming years
          • No plan of hiving off polymer business into separate entity
          • Performance of polymer business remains challenging due to uncertainties surrounding GST and after effects of demonetization
          • Robust demand from agricultural as well as construction sectors for polymer piping business

          Plumbing Business

          • Share of plumbing business to be increased as it has better margins
          • The split between agriculture and plumbing business is targeted to be 50:50 as compared to 65:35 last year

          Capacity

          •  Total installed capacity is 265,000 tonnes per annum
          • Utilization of capacity is close to 90%
          • Capacity has been enhanced by 35000 tonnes during the year
          • Capacity addition of about 30,000 tonnes in upcoming year
          • PVC capacity is around 51000 per annum; utilization is nearly 50%

          Approvals

          • The company has received approval from core in railways for manufacturing of traction masts
          • Projects worth in excess of Rs. 40,000 crores have been announced to connect North-eastern states to rest of the country
          • Logistically well positioned to target these projects
          • Got approval in Mexico and Canadian Welding Bureau which qualifies the company to supply to North America as well
          • Strategy is to keep getting approvals and to keep interacting with customers in order to bid and secure projects

          Order Book

          Skipper Q4FY18 order book.png
          • Total order book as on March end is Rs. 2627 crores
          • Well diversified between domestic, PGCIL and private players, SEB and exports
          • In the order book, 44% is PGCIL, nearly 40% is SEBs and other domestic customers and rest is exports
          • Bulk of the order book would be in SEBs, private developers and telecom in domestic side in upcoming years
          • Total order book to sales is at approximately 1.5x of last year sales
          • Growth from increased participation opportunity from export, Northeast and east India states like Jharkhand, Bihar and Odisha.
          • Ordering in TBCB has been dull this year

          Growth Prospects

          • PCGIL’s plan to build intrastate transmission projects by tying up with SEB will give boost to industry
          • States like Karnataka, Tamil Nadu, West Bengal, Andhra Pradesh and Telangana are increasing T&D spending to reduce AT&C losses and building infrastructure on high voltage lines
          • Flagship programs like Saubhagya, IPDS and DDUGJY disperse good investments and opportunity in this sector
          • Diversified portfolio will enable to tap opportunities in sectors like railways, solar and telecom and reduce its overdependence on a particular industry
          • Confusion among channel partners led to deferment in placing newer orders and holding onto their inventories
          • With effects of demonetization, GST and RERA waning off and revival in the economy coupled with GST benefits for organized players, growth to get back to 35 to 40 % during the year
          • One of the lowest cost producers of TBCB globally
          • Focus is to maintain a balance between growth and margins
          • Devaluation of Rupee has made Indian products more competitive
          • Customers in 30 to 35 countries

          Vector Consulting

          • Vector Consulting Group to assist in polymer operations by implementing theory of constraints
          • Operations will be managed through a full-based replenishment system ensuring high availability at distributors with lower inventory in company’s supply chain
          • It will also aid in setting up and developing partnership with plumbers and contractors through a long-term loyalty program across relevant product range

          Working Capital

          • Manufacturing of own raw material, MS Angle, extends working capital cycle by 45 to 50 days
          • Slight increase in overall debt number in the working capital

          CAPEX

          • Total CAPEX plan is around Rs. 75 crores
          • CAPEX in engineering product business to be Rs. 55 crores including capacity expansion, maintenance CAPEX as well as test bed
          • CAPEX in polymer business to be around Rs. 20 crores including fittings, CPVC, HDPE as well as pipe business
          • CAPEX for FY18 was Rs. 61 crores

          JV with Metzerplas

          • JV with Metzerplas is expected to start operation by October 2018.
          • Location of JV is Hyderabad, work has already started
          • Total CAPEX is about $4 million of which Skipper’s portion is about $2 million
          • To be funded by partly debt and partly equity

          Debt

          • Total gross debt number is around 498
          • Debt with current maturity is around 45 crores
          • Debt to equity ratio stands at 0.78 as compared to 0.83 last year

          Raw material prices

          • Not affected by increase in raw material prices
          • Any increase or decrease in raw material prices is passed on to the consumers
             

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          Biocon Q4FY18 Concall Summary

          Biocon.png

          Financial Highlights

          FY18:

          • Total Consolidated Revenues for the year were at Rs.4336 crores, up 6% compared to the previous fiscal.
          • Revenues from Operations were Rs.4130 crores, which reflects a growth of 5% compared to the previous fiscal. This includes licensing income of Rs.23 crores as compared to Rs.145 crores the previous year.
          • Biocon incurred a gross R&D spend of Rs.380 crores this year. Of this amount, Rs.216 crores is reported in the P&L corresponding to 8% of revenues excluding Syngene. They capitalized an amount of Rs.165 crores as compared to Rs.135 crores in FY2017.
          • Biocon booked a forex gain of Rs.83 crores this year, compared to a loss of Rs.3 crores the previous year. Major gains amounting to Rs.74 crores were booked in Syngene.
          • Group EBITDA stood at Rs.1035 crores for the year, down 9% with an EBITDA margin of 24%. Core margins that is EBITDA margins net of licensing, impact of forex, and R&D stood at 27%.
            Reported Net Profit for the year was Rs.372 crores, which represents a Net Profit margin of 9%.
          • The effective tax rate for the full year at 26% again appears higher than last year of 19%.
          • The Board of Directors have recommended for approval by the shareholders, a Final Dividend of Re.1 per share (20% of face value of each share) for the financial year 2017-18.

          Q4FY18

          Biocon Q4FY18 Financial Highlights.png
          • Total Consolidated Revenues for the quarter of Rs.1237 crores, which is up 27% compared to last year.
          • Revenues from operations were at Rs.1170 crores, which reflects a growth of 26% compared to last year. This includes licensing income of Rs.2 crores this quarter compared to Rs.16 crores in Q4 last fiscal.
          •   Biocon incurred gross R&D spends of Rs.98 crores this quarter. Of this, Rs.51 crores is reported in the P&L corresponding to 7% of revenues excluding Syngene. We capitalized an amount of Rs.47 crores related to their biosimilars and insulin analogs development expenses.
          • Biocon booked a forex gain of Rs.42 crores this quarter as compared to a loss of Rs.17 crores in Q4 last fiscal. This gain is reflected in the ‘other income’ line of the P&L statement.
          • Group EBITDA was at Rs.300 crores for this quarter, with EBITDA margin at 24%. Core margins, i.e. EBITDA margins net of licensing, impact of forex and R&D stood at 26%.
          • Reported Net Profit for the quarter was Rs.130 crores, which represents a Net Profit margin of 11%.
          • The effective tax rate at 21% for the quarter appears higher than last year tax rate of 2% last year as they had utilized R&D incentives and deferred tax asset for the full year in Q4 of last year.

          Key Busines Highlights of the year

          • Biocon’s partner Mylan received approval for Ogivri™, Biocon’s partnered biosimilar Trastuzumab from the USFDA in December 2017. It became the first company from India to get its biosimilar approved by the USFDA and their biosimilar Trastuzumab also received approval in Brazil through Biocon’s partner Libbs Farmaceutica. Subsequently an approval in Turkey was also received.
          • Mylan and Biocon also received approval from the European Commission and Therapeutic Goods Administration (TGA) Australia, for Semglee™, which is their biosimilar Insulin Glargine. Semglee™ is expected to be launched by their partner Mylan in Australia and Europe in the second half of this year.
          • Biocon and Mylan agreed to accelerate the introduction of biosimilar Adalimumab in Europe through Mylan’s in-licensing arrangement with Fujifilm Kyowa Kirin Biologics or FKB. FKB’s product is at an advanced stage of review with EMA and could potentially obtain approval in Europe in the second half of 2018.
          • Biocon and Mylan have also agreed to expand their longstanding collaboration with the addition of two next generation biosimilar programs with Insulin Glargine 300 units/ml and Pertuzumab.
          • Syngene, Biocon’s Research Services subsidiary, extended its contract and increased the scope of its engagement with BMS, its largest customer. Syngene also expanded its ongoing research collaboration with Amgen and signed a multi-year agreement with GSK.
          • Biocon was ranked among global top 10 biotech employers as per the 2017 rankings released by Science Career magazine. They are the only Asian company to feature in this list.

          Business segments

          Biocon Q4FY18 Segment Financials.png

          Small Molecules

          • Small Molecules revenues were Rs.1508 crores, which is down 8% from the previous year. The segment clocked revenues of Rs.426 crores for Q4FY18, which is up 8% YoY
          • This segment faced headwinds as a result of pricing pressure and channel consolidation by our clients in the US, which impacted our static sales. Continued demand for immuno-suppressants helped offset some of the pressure in this segment.
          • Despite the pressures, Viocon were able to increase market share for some of their specialty APIs in key markets.
          • Biocon also made regulatory submissions for multiple APIs across developed and key emerging markets. This will help this segment while moving into FY19.

          Biologics

          • Biologics revenues grew 10% to Rs.770 crores in FY18
          • Biologic segment revenues grew 47% in Q4FY18 and 10% for the full year.
          • The full year growth was impacted by shut down of fill-finish plant for modifications and requalification post regulatory audits last calendar year and lower licensing income pertaining to this segment.
          • Adjusting for impact of decrease in licensing income, product revenues growth was strong at 68% in Q4 and a decent 29% on a full year basis.
          • The growth was led by insulin sales in Malaysia via the offtake agreement, higher sales in Mexico where their partner won a government tender and traction in the AFMET region contributed to the insulin growth.
          • Antibodies product revenues increased as a result of the expansion of their geographical footprint in emerging markets.

          Branded Formulations

          •  Branded Formulations grew 14% to Rs.149 crores in Q4. and 11% to Rs.612 crores in FY18
          •  In FY18, the growth in Branded Formulations, which comprises India and UAE, were led by strong growth in the UAE business at 33%, while growth of the Indian business remain muted at 4%, with performance impacted due to various challenges faced by the business.
          • The UAE business reported an overall strong revenue growth driven by their metabolics portfolio, which comprises novel in-licensed products like Jalra and Imprida and their own brand of biosimilar Insulin Glargine, Glaricon™.
          • In India, Biocon launched Krabeva®, a biosimilar Bevacizumab, our second oncology biosimilar launch in India. Developed for the treatment of metastatic colorectal cancer and other types of lung, kidney, cervical, ovarian, and brain cancers, it is an important addition to our current oncology portfolio in India.
          • Biocon hadto take price reductions in some of their products, both mandatory as well as market-based. Furthermore, there was a temporary volume shortfall for certain biologic products due to the shutdown of their biologics facility in Q2 and Q3 of FY18.

          Syngene

          • Syngene registered revenues of Rs.1423 crores, reflecting a strong growth of 19% compared to the previous fiscal.    Syngene reported revenues of Rs.409 crores, up a solid 45% compared to Q4 of last fiscal.   Syngene reported revenues of Rs.409 crores, up a solid 45% compared to Q4 of last fiscal.
          • Syngene’s revenues recorded a strong growth this year on the back of an overall strong performance across its businesses. While discovery services and development manufacturing services showed strong momentum, dedicated centers continue to be on a strong footing.
          • Revenue growth in Q4 was a robust 45%, signaling a full recovery from the impact of the fire incident that happened in December 2016. The damaged facility is expected to be fully operational during the first quarter of FY19.

          Product Development Updates

          • The review of Biologics License Application (BLA) for biosimilar Pegfilgrastim by USFDA is progressing. The target action date for a decision by USFDA is June 4th, 2018.
          • In Europe, the regulatory review of Marketing Authorization Application (MAA) for biosimilar Trastuzumab and biosimilar Pegfilgrastim are also progressing and decisions by CHMP is expected by the end of this calendar year.
          • In the US, Mylan and Biocon’s application for Insulin Glargine under the NDA pathway is under review by the FDA.
          • The global Phase III trial of biosimilar Bevacizumab continues. For Insulin Aspart, Biocon has recently completed global Phase I study and expect a PK/PD readout shortly.

          Revenue from licensing

          • A lot of Biocon’s licensing income has been related to local partnering of their biosimilar assets and clearly looking at the biosimilar asset opportunities, their focus to date had been largely on Trastuzumab. 
          • Biocon still have opportunities with the other biosimilar programs to do partnering which are in late stage of development.

          Interest costs & expenses

          • The majority of the interest cost is on their debt in Malaysia, a debt of almost $180 million and the interest costs on that net of the subsidies which they receive from the Government of Malaysia is in the P&L.
          • Apart from that, Biocon have smaller debt facilities for other plants, and again bulk of that is in the P&L, and a very small component is capitalized along with the plant cost.
          • At some point in time Biocon are open to divesting a small stake in Syngene to raise additional funds if management prefer not to taking on too much debt on balance sheet.

          Capitalized expenses

          • Although the filing for Trastuzumab and Glargine is over, it does not necessarily mean that the expenses are over. 
          • Biocon still have some expenses coming for these two molecules. The bulk of the capitalization is now for Bevacizumab which is in global Phase III.
          • As per Biocon’s capitalization policy, they only capitalize molecules where they have got an approval for that particular molecule in one of the markets, thereby establishing scientific proof of concept and also the technical and the commercial feasibility.
          • For Toujeo and Perjeta, all the initial expenses, till the time of first approval will be in the P&L.

          CAPEX

          • Last year, the cash outflow at the Biocon level, excluding Syngene was around 400 crores. A small component of that was for the new antibiotics facility. 
          • Capex for FY19 & 20 should be anywhere around Rs.500-600 crores per year.
          • Majority of this is coming from our new antibodies facility, construction for which had started last year.
          • Mylan will also be contributing on that facility, so the numbers would get reduced. But the combined capex for next two years, at a Biocon level excluding Syngene, is expected to be around Rs.1000 crores.

          Future Outlook

          • Biocon expects the absolute numbers to go up next year and spends to be in a similar range of 15-16% of revenue. On an absolute basis, Biocon expect gross R&D spend to be in the range of Rs.450-500 crores.
          • The two new drugs that have been added to the pipeline with Mylan and molecules with Sandoz are in early stages of development. Greater spends from them will come when these molecules move into the clinic.
            The increase in R&D expenses next year will be on account of our novel molecules pipeline and ANDAs.

          Gross Margin pressure

          • If comparing with last year, there was a reduction of 4% and that’s mainly on account of Small Molecule pricing pressure. But if comparing it with the third quarter, then both the quarters had gross margin of ~55% which is in line with the trends seen in this year.

          IP issues

          • From Trastuzumab perspective Mylan and Roche are reaching to a global settlement. 
          • As far as Pegfilgrastim in the US is concerned, there is an on-going IP process as part of the BPCIA Act.

          Branded India business slowdown

          Main reasons:

          • Shortfall of biologics because of the upgradation and requalification of the plant
          • Biocon also had the impact of GST and had some unfavorable pricing which they had to take to face competition.

          Secondary reason: 

          • Biocon had some operational issues leading from attrition which impacted execution. So the next year, Biocon will not have these shortage issues and the impact of GST is behind.
          • In order to tackle pricing issues, Biocon have installed a key account team, which focuses on business and on key accounts and therefore to be able to guard the business more closely.

          Biologics vs Generics

          • The cost involved in bringing a generic molecule to the market is significantly lower; generally it is between 5 to 10 million dollars. Whereas it takes upwards of 100 million dollars to bring a biosimilar to the market.
          • It takes almost 3 to 5 years minimum to bring a biosimilar drug to the market compared to a generic molecule.
            Taking into account all these dynamics, it is very expensive and very long drawn out in terms of the regulatory time line to bring a biosimilar product to the market.So biosimilars have low competition and high prices.
          • The FDA and the EMA organization are learning along with the industry on how to approve these biosimilars with collaboration of Biocon and other frontrunners in the industry.

          Info on biosimilars

          • Pegfilgrastim

            • Biocon has had both resubmissions last year and there are typically changes in rapporteurs that are handling it and so there is some level of fresh look at it, but clearly Biocon benefit from the review that is already completed. So it is not essentially de novo.
            • On the FDA side, there is nothing new to report there. Biocon have their action date coming up in June and they are comfortable where they stand in the review process.
            • Pegfilgrastim will be launched in the second half. However management cannot comment on the Trastuzumab launch date because that is governed by the IP settlement.
            •  
          • IN105
            • The program right now is in Phase III, and Biocon have initiated the studies. A few patients have been dosed and the dosing will continue for the next couple of years. 
            • Biocon will look at the data on an interim basis sometime next year. It is all in discussion with the DCGI office. Biocon is very enthusiastic about this program.
          • Adalimumab
            • Biocon and FKB will participate in whatever costs and profits Mylan has as part of its deal.
            • They participate in their share of that as per global arrangement. So to that extent it would be a three-way.
            • However, Biocon’s own product has completed phase III clinical in the first half of 2017. There is time to take a decision on which option to pursue in the US and in other markets. So the management have not ruled in or ruled out any option outside of Europe at this stage.

          Malaysian Operations

          •  In FY18, Malaysia reported an operational loss of $5 million at a standalone level, when excluding the impact of R&D. In FY19, the fixed expenses are projected to increase to $50 million on account of increase in operating expenses.
          •  Biocon’s Malaysia insulin facility is making good progress and receiving approvals for both the facility and the products from various regulatory agencies globally which will help them aim for operational breakeven in Malaysia after excluding R&D expenses in FY19.
          • At an operational level the P&L would have a delta of 7 million dollars. However due to various moving parts, one cannot necessarily correlate the delta with the top line growth with accuracy.

          ANDA filings

          • Biocon have filed 2 ANDAs in FY18 and our plan is to file more in FY19.
          • R&D ramp up on small molecules is also likely to be seen going forward, largely because of management’s focus on submitting some of these ANDAs which are not just regular, but difficult to make products.

          Bangalore Plant

          • The construction for this new facility started last year. It will take about two years to commission the facility, a year after that to qualify and file for approvals, and then one year to get the approvals.
          • So by next year, the facility itself should be commissioned and in 2020 Biocon will do the development work to file in various markets. Finally, in early 2021 commercial sales are expected to start from that facility.

          Contribution of Biologics

          • With increasing performance of biosimilars portfolio in the market place, a better contribution from the Biologics is expected. The percentage contribution of the Biologics segment to the overall business pie is definitely going to trend upwards. 
          • Being a high value and a high margin business, margins should also improve once biosimilars become a significant part of the business.
          • Aspirational target of $1 billion dollar
          • Biocon is well on track for Biologics and Research Services.
          • However, Biocon are likely to face some challenges and headwinds in their Branded Formulations numbers and also in terms of their Small Molecules numbers.
          • Because of the kind of market dynamics that are prevailing in the world, there have been tremendous pricing pressures, price enforcement by NPPA etc.
          • There are a lot of challenges that Biocon had not anticipated, maybe five years ago which are proving to be a hindrance in achieving $1 billion revenue in FY2019.

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          Yes Bank Q4FY18 Concall Summary

          Yes Bank.png

          Financial Highlights

          Yes Bank Q4FY18 financials.png

           

          • The total assets crossed Rs 3 trillion mark in the Q4
          • Both total deposits and total loan crossed INR 2 trillion mark
          • International banking asset clocked the level of $2.8 billion which they have booked in the GIFT CITY
          • The NPA of the bank improved to 1.28% as compared to 1.72% in the quarter ended in last December
          • The net credit cost for the year was curtailed to 76 basis point even when the overall market expectations stood somewhere between 100 to 120 basis point
          • The guidance for the net credit cost for the coming fiscal is set somewhere between 50 to 70 basis points
          • The dividend payout ratio to remain at 17.7% 
          • Net profit recorded an increase of 29% in Q4 to reach the figure of INR 11794 million and for the whole FY the net profit grew by26.9% 
          • Net interest income showed an improvement of 31.4% over the preceding quarter and on YoY basis it grew by 33.5%
          • Income from non-interest services increased to INR 14210 million with an improvement of 13% over the preceding quarter
          • Cost to income ratio for the whole year improved by 1.2% to remain at 40.2% in comparison to the last fiscal year
          • ROA for the year stood at 1.6% and ROE for the year stood at 17.7% 
          • Total assets of the bank grew by 45.3% in the year to surpass the 3 trillion mark
          • Offshore assets through International Business Unit of the bank grew by 166% YoY
          • With a sequential growth of 90% and YoY of 54.1% the corporate business across the eight relationships groups stood 67.9% at the end of the Q4
          • Bank was able to maintain a healthy capital adequacy ratio of 18.4%
          Yes Bank Q4FY18 Key Financial Parameters.png

          Recognition

          • Yes bank has been ranked overall #2 by the Ministry of Electronics and Information Technology across all bank segments
          • German Agency OEKOM research awarded YES bank the prime status which made it the only Indian bank to receive such a recognition

          Bonds

          • Funds through perpetual bonds of Rs 54.15 billion and Rs 70 billion of Tier-II bonds were raised

          Risk Weighted Assets

          • Total risk weighted assets of the bank stood at INR 2.55 trillion
          • The ratio of the RWA to the total assets improved by 5% in the year
          • Bank has target of bringing the RWA to the total assets to 70%

          NPAs

          Yes Bank Asset Quality Q4FY18.png
          • Sequential improvement in NPA from 0.93% to 0.64%
          • The PCR coverage at present is 50% with an improvement of 3.6% from the December
          • The Bank has set a target to raise the PCR to 60% by September

          Asset Quality Composition

          Yes Bank Sectoral Mix Q4FY18.png
          • Portfolio of the security receipts improved from 1.06% to 0.92% sequentially from December
          • Out of total outstanding security receipts of INR 18.8 billion recovery of 35-40% is expected in the FY 2018-19

          NCLT-I

          • YES Bank has exposure to only two accounts out 12 as listed by the RBI, and only accounted for 0.16% of the total advances
          • The provisioning coverage on the two accounts remains at 50%
          • In NCLT-II YES bank has exposure to the 7 bank accounts out of 28
          • Total loan amount for 7 accounts stood at Rs 6.5 billion with three major accounts amounting to Rs 5.7 billion
          • The provisioning coverage on 7 accounts remains at 43% 

          Corporate Portfolio

          • The overall value of the corporate advances stood at 67.9% of the total advances
          • The sensitive sectors as classified by the bank are energy and power sector, Iron and steel, Telecom and gems and jewelry
          • 80% of the corporate portfolio has been rated A

          Infrastructure and HR Resources

          • Bank has a total of 1100 branches and ATM network of 1724
          • Total headcount of the human resources stood at 18238
          • In order to improve the service levels, quality assurances and turnaround time back-office operations of the bank would be shifted to 700000 sq.ft. centralized center in Chennai

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