Piramal Enterprises slumps on reporting Q4 net loss of Rs 1703

Piramal Enterprises tumbled 9% to Rs 847.75 after the company reported a consolidated net loss of Rs 1,702.59 crore in Q4 March 2020 as against net profit of Rs 454.63 crore in Q4 March 2019.

Net sales declined 2% to Rs 3341 crore in Q4 March 2020 from Rs 3408.52 crore in Q4 March 2019. The result was announced after market hours yesterday, 11 May 2020.

Pharmaceuticals segment revenue grew by 10% to Rs 1623 crore in Q4 March 2020 from Rs 1476 crore in the same period last year.

Financial services segment revenue declined 11% to Rs 1718 crore in Q4 March 2020 from Rs 1933 crore in Q4 March 2019. The company's loan book stood at Rs 50,963 crore with top-10 exposures reduced by Rs 4,200 crore during the year. The company said Rs 8,900 crore were available in the form of cash and undrawn bank lines as of 31 March 2020. Capital Adequacy ratio of the Financial Services business rose to 31% in Q4 March 2020 from 22% in Q4 March 2019.

Commenting on company's performance, Ajay Piramal, Chairman, Piramal Enterprises said, "The last few quarters have been challenging for the Indian economy. The situation has further worsened due to the COVID-19 pandemic, with a subsequent economic recovery likely to be long-drawn. To navigate through such an environment, we have significantly strengthened and deleveraged our balance sheet through multiple initiatives to raise capital. Our Pharma business continues to be operational despite COVID 19 lockdowns and has delivered a healthy revenue growth of 13% YoY to Rs 5,419 crore and an EBITDA margin of 26% for FY20. We have consciously shrunk our wholesale loan book by 12% and more importantly, reduced our large single borrower exposure by Rs 4,200 crore over the past year.

Further, given the uncertain macro environment, we have created Rs 1,903 crore of additional provision to mitigate potential contingencies in our financial services business."

Piramal Enterprises' consolidated net profit tumbled 98.6% to Rs 24 crore on a 10% increase in net sales to Rs 13068.29 crore in the year ended March 2020 (FY20) over the the year ended March 2019 (FY19). The board has declared a final dividend of Rs 14 per share for FY20.

Piramal Enterprises (PEL) is one of India's largest diversified companies, with a presence in financial services, pharmaceuticals and healthcare insights & analytics.

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