Advanced Enzymes –
Q1 FY 25 concall and results highlights –
Revenues – 155 vs 147 cr, up 5 pc
EBITDA – 51 vs 44 cr, up 16 pc ( margins @ 33 vs 30 pc )
PAT – 35 vs 29 cr, up 19 pc
Segment wise sales breakup –
Human nutrition – 101 vs 99 cr, up 2 pc ( 65 pc of sales )
Animal nutrition – 17 vs 16 cr, up 7 pc ( 11 pc of sales )
Industrial bio processing – 25 vs 22 cr, up 12 pc ( 16 pc of sales )
Specialised manufacturing – 11 vs 10 cr, up 10 pc ( 7 pc of sales )
Geographical breakup of sales –
India – 74 vs 74 cr, flat
Americas – 59 vs 47 cr, up 27 pc
Europe – 7.5 vs 6.5 cr, up 13 pc
Asia – 11 vs 12 cr, down 7 pc
RoW – 3 vs 8 cr, down 60 pc YoY
Manufacturing facilities –
08 in India, 01 in US
05 R&D units in India, 01 each in US and Germany
Company is a leading manufacturer of Probiotics and Enzymes. Company makes over 400 products derived to of 68 indigenous enzymes. These are substitutes of chemicals and find applications in diversified industries like – healthcare, agrochemicals, animal and human food etc
Enzymes – are proteinaceous molecules which serve as bio-catalysts. They not only replace traditional chemical agents but also bolster efficiency and efficacy of a wide array of products. Find wide applications in – baking, food processing, dairy processing, leather processing, biofuels, biomass processing, biocatalysis etc
Probiotics – are living microorganisms that confer significant health benefits to both humans and animals. They also find application in treating disease in areas like – inflammatory bowel disease, urogenital infections etc
Company stared its manufacturing operations in 1994 with just 07 enzymes. Today, it makes 68 different enzymes
Biggest entry barrier to this industry is real time R&D with requirements of continuous technical upgrades and efficiency improvements – both are long gestation traits
Company is expecting robust growth trajectory for all its products in H2 this yr
Company’s largest product – an anti-inflammatory enzyme ( serrapeptidase ) recorded a sales of 28 cr vs 35 cr YoY, a de-growth of 20 pc
R&D spends @ 7.6 vs 6.2 cr YoY
Company was working on some sugar management and weight loss products. The same has been launched in the US on a trial basis
Guiding for 33-34 pc kind of EBITDA margins for full FY 25. Also expecting a 12-14 pc kind of topline growth for full FY 25. Most of the growth should be back ended – ie – in H2
Capex requirement for current and next FY should be light @ 25-30 cr each
Company does have a lot of products ( around 50 of them ) under development ( at various stages ). As these products get their requisite approvals, go commercial – they should drive company’s growth
Company has also started their B2C business under the WELLFA brand – so make and sell wellness products. Currently in nascent stages – likely to clock 2-3 cr of annual sales
As a medium term vision – company aspires to keep growing at 10-12 pc kind of rates for next 4-5 yrs and breach the 1000 cr topline number
LY, company had a one off legal expense of 18 cr for settlement with a US based competitor. Don’t see any such exceptional expense this FY
Company’s current capacity utilisation @ around 60- 65 pc
According to the management, as the capacity utilisation improves, every 1 pc increment in revenue should lead to a 2 pc kind of growth in EBITDA and bottomline
Disc : holding, biased, not SEBI registered, not a buy/sell recommendation
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