Nicholas Piramal shares only reflected the company's strong FY 2002-03 results in early trades on Friday.

In fact, they sprang forth 5.3% to Rs 231 on BSE barely as trading commenced. The scrip achieved an early high of Rs 232.95 on Friday. A total of 5,791 Nicholas Piramal India shares changed hands on BSE in a few minutes of trading.

The stock witnessed a recovery over the last few trading sessions in the run up to the results. From a recent low of Rs 206.25 on 31 March 2003, the scrip surged 6.35% Rs 219.35 on 24 April 2003. The recovery in the stock came amid intermittent corrections, though.

NPIL has registered a strong growth in sales and profits for the year ended 31 March 2003. The company has turned out gross sales of Rs 1,136.13 crore (Rs 11.36 billion), a growth of 20%. The company has improved its EPS before extraordinary items to Rs 41.0 from Rs 20.3 in the previous year. ROCE stands at 32 % while RONW after extraordinary items is at 32 %.

On a comparable basis, if the sales of the Cardex division (the erstwhile pharma division of ICI India Limited) and Global Bulk Drugs & Fine Chemicals Private Limited, which was merged with the company effective 1 January 2003, are excluded, gross sales growth would be 11 %.

NPIL's domestic formulations business grew at 19.9%. Excluding the sales gained by the acquisition of the erstwhile pharmaceutical division of ICI Ltd, the formulations business grew 13 % against an industry growth rate of 5.7 % (ORG-MARG MAT, March 2003). This business has outperformed the industry and grown market share through a combination of new products and innovative brand management, the company said in a release.

NPIL launched 21 products during the year under review, most of them in high growth lifestyle therapeutic segments such as oral anti-diabetics, anti-depressants, cardio-vascular and anti-arthritics. NPIL's material cost reduced from 52.2 % of net sales in FY02 to 48.9 % of net sales during FY03.

The company has brought down its interest burden over the last 12 months through a debt reduction of Rs 52.56 crore and the substitution of high cost debt with lower cost debt. Net interest for FY03 has come down 34.4 %, to Rs 20.57 crore. NPIL obtained a tax break of Rs 26.4 crore on account of the amalgamation of group company Global Bulk Drugs and Fine Chemicals which is a bulk drugs company. NPIL has strengthened its balance sheet by fully writing off the unamortised deferred revenue expenditure of FY02 by taking an exceptional charge of Rs 34 crore in its P&L for FY03.

BSE code: 500302