The Board of Directors recommends a Final Dividend of 25%, i.e. Rs.1.25 per equity share of Rs.5 each, subject to approval of shareholders.
DIL Ltd. announced the results for the fourth quarter of the current financial year along with the results for the financial year ended 31st March, 2019. The consolidated results also include the results of Fermenta Biotech Ltd., DIL Ltd.’s 91.2% subsidiary.
Highlights of DIL Ltd’s Consolidated Financial Performance for the year ending March 31, 2019 include :
● Total Revenue (including other income) up by 34% YoY to Rs.417 Cr.
● EBITDA (including other income) grew by 58.1% YoY to Rs.161.2 Cr, margins maintained at a healthy 38.7%
● PAT grew by 115% YoY to Rs.117.9 Cr.
● Board of Directors recommends a Final Dividend of 25%, i.e. Rs.1.25 per equity share of Rs.5 each, subject to approval of shareholders
The results have been driven by the continued robust growth in DIL’s subsidiary, Fermenta Biotech Ltd. Fermenta Biotech Ltd. (FBL) is the only manufacturer and supplier of Vitamin D3 (Cholecalciferol) in India and amongst the leading players globally. Apart from Vitamin D3, Fermenta also possesses expertise in integrated biotechnology solutions such as enzymes for antibiotic synthesis and other niche APIs.
Highlights of Fermenta Biotech Ltd.’s Financial Performance for the year ending March 31, 2019 include :
● Revenue (including other income) stood at Rs.401.3 Cr for FY19 as against Rs.300.4 Cr in FY18 up by 33.6% YoY led by higher volumes of Vitamin D3 supported by better realizations.
● EBITDA margins stood at 39.8% for FY19 as against 34.3% in FY18
● PAT for FY19 stood at Rs.113 Cr; showing a growth of 56.8% YoY
Commenting on the performance, Satish Varma, Managing Director, Fermenta Biotech Limited said, “We are very proud to achieve a milestone of crossing Rs.100 Crores in Net Profits at FBL. This is the highest ever in the history of the company. We have surpassed our guidance of 25% revenue growth for FY19 at the consolidated level by a huge margin. Vitamin D3 continues to witness strong demand, having reported overall growth in revenues of 39% in FY19 on a YoY basis, with Vitamin D3 for Pharmaceuticals use which is 33.6% of overall revenues witnessing a growth of 54.3 %, and Vitamin D3 for Animal Feed use which is 49.8 % of overall revenues witnessing a growth of 30.2%.”
Expanding on the future plans for business growth, he added, “Based on the higher demand for Vitamin D3 from Pharmaceuticals as well as Animal Feed segments, we are working on adding incremental manufacturing capacity at our Dahej plant in phases. However, for the next level of growth, we have already started planning for new capex at our recently acquired land parcel at Sayakha, GIDC near Bharuch. We have currently applied for Environmental Clearance for the project and are waiting for the same. The capex at Sayakha will help us to forward integrate into Dietary Nutritional Supplement products which is the natural extension to our Vitamin D3 business.”
Commenting on the other businesses, he said ‘Our Enzymes manufacturing business also had a strong performance for the year with revenues growing at 140.6 % from Rs. 5.7 crores in FY18 to Rs. 13.8 Crores in FY19. This is a highly profitable business once it achieves an optimum scale/size. The upgrade in Credit Rating is on back of improved financial and operations performance of Fermenta and the merger will strengthen DIL’s balance sheet further. We believe with growing awareness of Vitamin D3, we expect the growth in volumes to continue which will help us to grow at a CAGR of 15% to 20% over the next 5 years’.
Business Updates :
Fermenta Biotech Limited has taken a planned shutdown of the Dahej plant to carry out major repairs and maintenance work and also de-bottlenecking programme with effect from week starting April 22, 2019 for a period of approximately four weeks. Such shutdowns are done in 3-4 years for the upkeep of high technology plant and machinery. The programme is progressing as per schedule and is expected to be completed by May 31, 2019. Post completion of this de-bottlenecking programme, the production capacity will increase by approximately 10-15%. The de-bottlenecking programme is part of the overall strategy to increase the production capacity to meet the high demand from customers.
During the quarter under review, the CARE Ratings Ltd. has upgraded the credit rating assigned to ‘Fermenta Biotech Limited’, Company’s subsidiary. The rating on Long Term Bank Facilities for fund based limits and term loan has been upgraded to CARE A- (Single A minus) with Stable outlook from CARE BBB+ (Triple B Plus) under Credit watch with developing implications and credit rating on Short Term Bank Facilities for non-fund based limits has been upgraded to CARE A2 (Single A two) from CARE A3+ (A Three Plus) under Credit watch with developing implications. The rating upgrade takes into account the impact of the proposed amalgamation of Fermenta Biotech Limited with the Company. Consequently, the outlook has also been changed from “credit watch with developing implications” to “stable”.