Assessing Ajanta Pharma Limited’s (NSEI:AJANTPHARM) past track record of performance is an insightful exercise for investors. It allows us to reflect on whether or not the company has met or exceed expectations, which is a great indicator for future performance. Today I will assess AJANTPHARM’s recent performance announced on 30 September 2017 and evaluate these figures to its long-term trend and industry movements. See our latest analysis for Ajanta Pharma
Commentary On AJANTPHARM’s Past Performance
I use data from the most recent 12 months, which annualizes the most recent half-year data, or in some cases, the latest annual report is already the most recent financial year data. This method allows me to analyze various companies in a uniform manner using the latest information. For Ajanta Pharma, its most recent trailing-twelve-month earnings is ₹4,833.0M, which, in comparison to last year’s level, has increased by a fairly unexciting 4.57%. Given that these values may be relatively myopic, I’ve calculated an annualized five-year value for AJANTPHARM’s net income, which stands at ₹3,409.2M. This means that, on average, Ajanta Pharma has been able to increasingly improve its profits over the past couple of years as well.
What’s enabled this growth? Let’s see whether it is solely because of industry tailwinds, or if Ajanta Pharma has seen some company-specific growth. Over the last couple of years, Ajanta Pharma expanded its bottom line faster than revenue by efficiently controlling its costs. This has caused a margin expansion and profitability over time. Inspecting growth from a sector-level, the IN pharmaceuticals industry has been growing its average earnings by double-digit 11.44% over the past twelve months, and 14.21% over the past five. This means that any uplift the industry is enjoying, Ajanta Pharma has not been able to reap as much as its industry peers.
What does this mean?
Ajanta Pharma’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. While Ajanta Pharma has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. I recommend you continue to research Ajanta Pharma to get a better picture of the stock by looking at:
1. Future Outlook: What are well-informed industry analysts predicting for AJANTPHARM’s future growth? Take a look at our free research report of analyst consensus for AJANTPHARM’s outlook.