Neuland Laboratories: Unveiling the Success Behind 380% Multi-bagger Returns

Neuland Laboratories: Unveiling the Success Behind 380% Multi-bagger Returns

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  • Neuland Laboratories Ltd. is a prominent player in the pharmaceutical industry, specializing in the manufacturing and supply of bulk medicines to both domestic and international markets.
  • The company released its Q3 FY24 results on Monday morning, following a 5.47 percent decline in its stock price.
  • Despite the current correction, Neuland Laboratories has been a multi-bagger stock. The company has given returns of 380 percent in a year.
  • Big investors such as Mukul Aggarwal and Vijay Kedia have shown their confidence in Neuland Laboratories by acquiring significant stakes in the company. Mukul Aggarwal holds a 3.12 percent stake, equivalent to 4 lakh equity shares, while Vijay Kedia possesses a 1.25 percent stake, equivalent to 1.6 lakh equity shares.
  • The company’s market capitalization currently stands at approximately Rs 8,205 crore.
  • The company has reported robust operating revenue growth of 45.89 percent year-over-year. The company’s operating revenue reached Rs 392.82 crore in Q3 FY24. In the same quarter of last year, it was Rs 269.25.
  • The company’s net profit also increased by 166.50 percent, from Rs 30.54 crore in Q3 FY23 to Rs 81.39 crore in Q3 FY24.
  • The company’s customized manufacturing solutions constitute 49 percent, prime API accounts for 25 percent, specialty makes up 20 percent, and other segments contribute 6 percent to the total revenue. 

About Neuland Laboratories Limited

• Neuland Laboratories Limited: A Leading Pharmaceutical Industry Company. The company was established in 1984 and is headquartered in Hyderabad, India.
• The company is a leading manufacturer of active pharmaceutical ingredients (APIs).
• The company provides comprehensive solutions for the pharmaceutical industry’s chemistry requirements.
• The company offers the synthesis of library compounds, the supply of new chemical entities (NCEs) and advanced intermediates, and support for commercial launches.
• The company has 1600 well-qualified employees and focuses on strong process chemistry applications in a regulatory-compliant environment.
• The company has a remarkable track record of regulatory approvals, with 16 successful US FDA inspections.
• The company serves clients across the entire product lifecycle, covering more than 100 APIs across ten therapeutic areas. And operates a state-of-the-art R&D center near Hyderabad, housing around 300 scientists.
•
• The company has state-of-the-art manufacturing facilities with three world-class plants equipped with advanced technology.
• The company is certified by renowned authorities such as the USFDA, EDQM, EMA, PMDA, TGA, and more.
• The company maintains a global presence in over 80 countries with over 972 Drug Master Files (DMFs).
• The company extends its impact across more than 80 countries, with over 76% of revenues generated from exports.

Management of Neuland Laboratories Limited

NameDesignation
Davuluri Rama Mohan RaoExecutive Chairman
Davuluri Saharsh RaoVice Chairman & Managing Director
Davuluri Sucheth RaoVice Chairman & CEO
Humayun DhanrajgirInd. Non-Executive Director
Nirmala MurthyInd. Non-Executive Director
Homi Rustum KhusrokhanInd. Non-Executive Director
Christopher M CimarustiNon Executive Director
Bharati RaoInd. Non-Executive Director
Parampally Vasudeva MaiyaInd. Non-Executive Director
Prasad Raghava MenonInd. Non-Executive Director

Registered Address of Neuland Laboratories Limited

11th Floor (5th Office Level),
Phoenix IVY Building,,Plot No.573A-III,
Hyderabad
Telangana
500033

Tel: 040-67611600
Fax: 040-67611602
Email: ir@neulandlabs.com
Website: http://www.neulandlabs.com

Industry Type

SectorHealthcare
Sub SectorPharmaceuticals
ClassificationSmallCap
Industry NamePharmaceuticals -Indian -Bulk Drugs
BSE Scrip Code524558
NSE Scrip CodeNEULANDLAB
ISININE794A01010

Pros of Neuland Laboratories Limited

The Company has reduced debt.
The Company is almost debt free.
The Company is expected to give good quarter
The Company has delivered good profit growth of 68.3% CAGR over last 5 years

Cons of Neuland Laboratories Limited

Stock is trading at 7.31 times its book value
Promoter holding has decreased over last quarter: -3.17%
Promoter holding is low: 32.8%
The Company has a low return on equity of 12.1% over last 3 years.

Historical Performance

YearsLowHigh
1 Year1362.656914.10
3 Years967.006914.10
5 Years245.756914.10

Investment Returns

PeriodReturns
1 year359.87%
2 Years468.25%
3 Years227.91%
4 Years1230.26%
5 Years1207.49%

Dividend History of Neuland Laboratories Limited

Announcement DateEx-DateDividend TypeDividend (%)Dividend (Rs)
11-05-202311-07-2023Final10010.00
10-05-202214-07-2022Final505.00
11-05-202129-06-2021Final303.00
19-10-202010-11-2020Interim202.00
05-02-202018-02-2020Interim202.00
16-05-201927-06-2019Final121.20
23-05-201604-08-2016Final202.00
08-05-201506-08-2015Final151.50
08-05-201416-06-2014Special151.50
09-05-201416-06-2014Final151.50
10-05-201324-07-2013Final121.20
25-05-200913-07-2009Final353.50
23-05-200817-07-2008Final252.50
21-05-200711-07-2007Final252.50
23-06-200601-08-2006Final202.00
14-06-200520-07-2005Final121.20
21-06-200318-07-2003Final101.00
10-06-200211-07-2002Final180.00
29-05-200127-06-2001Final150.00

Chart

Neuland Laboratories: Unveiling the Success Behind 380% Multi-bagger Returns
Neuland Laboratories: Unveiling the Success Behind 380% Multi-bagger Returns

Fundamental Analysis of Neuland Laboratories Limited

ParameterValue
Market Cap₹ 8,273 Cr.
Current Price₹ 6,453
High / Low₹ 6,961 / ₹ 1,356
Stock P/E26.1
Book Value₹ 883
Dividend Yield0.15%
ROCE20.8%
ROE17.9%
Face Value₹ 10.0
Pledged Percentage0.00%
EVEBITDA16.8
Change in Prom Hold-3.17%
Debt to Equity0.09
Return on Equity17.9%
EPS₹ 247
Price to Book Value7.31
Dividend Yield0.15%
Debt₹ 101 Cr.

Peer Comparison

NameP/EMar Cap Rs.Cr.Div Yld %ROCE %
Divi’s Lab.71.8299324.60.819.36
Jubilant Pharmo255.399347.290.853.13
Neuland Labs.26.098273.450.1520.85
Aarti Drugs30.564856.50.1915.34
Ami Organics54.273870.810.2920.58
Hikal49.23523.860.428.43
Guj. Themis Bio.43.942415.040.3261.14

Shareholding of Neuland Laboratories Limited

HoldersMar-20Mar-21Mar-22Mar-23Dec-23
Promoters 35.90%36.20%36.22%36.22%36.14%
FIIs 27.36%26.97%17.21%17.21%18.14%
DIIs 10.47%6.87%5.30%6.38%7.10%
Govt0.00%0.00%0.00%0.00%0.40%
Public26.27%29.96%41.27%40.19%38.22%
Others

Last 5 Years’ Sales (In Cr.)

March 2019March 2020March 2021March 2022March 2023
6677639379511,191

Last 5 Years’ Net Profit (In Cr.)

March 2019March 2020March 2021March 2022March 2023
16168164164

Balance Sheet of Neuland Laboratories Limited (In Cr.)

 ParameterMar 2020Mar 2021Mar 2022Mar 2023Sep 2023
Equity Capital1313131313
Reserves6977748289811,120
Borrowings264182241128101
Other Liabilities257356302457431
Total Liabilities1,2311,3251,3831,5801,665
Fixed Assets653716767758800
CWIP2417204112
Investments87410
Other Assets547585592781853
Total Assets1,2311,3251,3831,5801,665

Compounded Sales Growth

10 Years:10%
5 Years:18%
3 Years:16%
TTM:52%

Compounded Profit Growth

10 Years:29%
5 Years:68%
3 Years:117%
TTM:215%

CAGR

10 Years:38%
5 Years:61%
3 Years:49%
1 Year:356%

Return on Equity

10 Years:9%
5 Years:9%
3 Years:12%
Last Year:18%

Cash Flow (In Cr.)

ParticularsMar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Operating Activities705718960237
Investing Activities-77-49-84-95-61
Financing Activities12-5-11438-136
Net Cash Flow53-9340

Revenue and Profit Trend

Financial YearRevenue GrowthProfit Growth
FY 2022-2325.25%156.75%
FY 2021-2211.51%-20.87%
FY 2020-2122.84%405.63%
FY 2019-2014.38%-1.63%
FY 2018-1926.44%36.71%

Also Read – Breaking News: Rs 100/Share Dividend Unveiled by Debt-Free Stock with Strong Promoter Holding – Buy or Miss Out?

Conclusion

This is a comprehensive guide to Neuland Laboratories Limited. The above-mentioned information and data are as of February 12, 2024. These figures and projections are based on our research, analysis, company fundamentals and history, experiences, and numerous technical analyses. In addition, we have discussed in depth the share’s prospects and growth potential. Hopefully, these details will be useful in your future investments.

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Disclaimer: Dear Readers, we are not authorized by SEBI (Securities and Exchange Board of India). The information provided above is for educational purposes and should not be considered financial advice or stock recommendations. Share price predictions are for reference purposes and are based on positive market indicators. The analysis does not account for uncertainties about future or current market conditions. The author, brokerage firm, or Finreturns.com are not liable for losses resulting from decisions. Finreturns.com advises consulting with certified experts before investment decisions.

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