Common-size Analysis

Himanshu Ahire Roll No 13

Thursday 1 April 2010 1

 COMPANY BACKGROUND

Events CIPLA Dr. Reddy’s Lab

Established Year 1935 Capital 6 Lakh Year 1986 Capital 25 Lakh

Prescribed Medicines,Animal Prescribed Medicines, Bulk

Products Health,OTC, Bulk Drugs, Drugs, Generic Drugs &
Technology Services manufacturing services
Global 100 Countries Focus on India,
180 Countries
Presence US, Europe & Russia

Market Cap 27,199 Cr 21,354 Cr

Turnover 5,270 Cr 4,197 Cr

Asset Size 5,290 Cr 5,899 Cr
Employee
7000 8683
Strength

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 CAPITAL STRUCTURE

Liability Dr. Reddy’s Lab CIPLA

Share Capital 1.43% 2.94%

Reserves 87.72% 79.12%

Net Worth
89.15% 82.23%
(Proprietary Ratio)

Total Debt 10.85% 17.77%

Debt/ Equity 0.12 0.22

•Over Capitalized ?
•Investor View
•Banks / Suppliers/ Bond Holders ( Third party Liability)
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 ASSET ALLOCATION

Dr. Reddy’s CIPLA

60% 54%

45% 38% 41%

30% 32%
30%

15% 7% 7%
2%
0%
Fixed Asset Capital Progress Investment Net Current Assets

Company Current Ratio Quick Ratio Debt/ Equity

Dr. Reddy’s 1.85 2.13 0.12
CIPLA 1.81 1.93 0.22

•Inorganic Growth
•Current Asset Efficiency
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 CONTINGENT LIABILITIES

Company Contingent Liability Percentage

Dr. Reddy’s 1,934.8 33%
CIPLA 730.75 14%

• Risk Associated with Subsidiary Companies

• Patent Disputes
• Investor View
• Third Party View

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 OPERATING EFFICIENCY

Particulars CIPLA Dr. Reddy’s Lab

Total Income 5,208.33 4,275.8
Operating Expense 78.78% 77.31%
Operating Profit 23.90% 17.73%
PBDIT 21.22% 22.69%
Interest 1.00% 0.64%
Depreciation 2.91% 4.53%
PBT 17.31% 17.6%
Tax 2.39% 3.94%
Net Profit 14.91% 13.12%

•Non Operating Income

•High Depreciation
•Tax Benefits

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 OPERATING EFFICIENCY

Ratio CIPLA Dr. Reddy’s Lab

Return On Share Holder Investment
17.85% 10.67%
= PAT/Share Holders Fund
Return On Capital Employed
20.89% 16.45%
= PBIT/Total Capital Employed

EPS 9.99 33.29

PE 25% 28%

• CIPLA : High Return on Investments

• CIPLA : Better Leverage

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 Thank You

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