Revenue and Operating Performance Trends
Wockhardt's net sales have experienced variability, with figures peaking at ₹3,565 crore in March 2019 before declining and fluctuating in subsequent years. The fiscal year ending March 2025 recorded net sales of ₹3,012 crore, reflecting a modest recovery from the previous year’s ₹2,798 crore. This oscillation in revenue highlights the competitive pressures and market dynamics faced by the pharmaceutical company.
Operating profit margins excluding other income have shown a gradual improvement, reaching 13.05% in March 2025 compared to a low of 1.39% in the prior year. The operating profit (PBDIT) excluding other income rose significantly to ₹393 crore in the latest fiscal year from ₹39 crore in March 2024, signalling enhanced operational efficiency. However, the company’s gross profit margin remains relatively low at 6.67%, indicating ongoing cost pressures.
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Profitability Challenges and Losses
Despite improvements in operating profit, Wockhardt has struggled to achieve net profitability in recent years. The consolidated net profit remained negative for six consecutive years, with a loss of ₹47 crore in March 2025. The company recorded a significant net profit of ₹686 crore in March 2021, an outlier in an otherwise challenging period marked by losses exceeding ₹400 crore in some years.
Earnings per share (EPS) have mirrored this volatility, with a negative EPS of ₹-2.9 in the latest fiscal year, contrasting sharply with a positive ₹61.93 in March 2021. The persistent losses have been influenced by high interest expenses, which stood at ₹254 crore in March 2025, and substantial depreciation charges, reflecting the capital-intensive nature of the business.
Balance Sheet and Financial Position
Wockhardt’s balance sheet shows a steady increase in shareholder’s funds, rising from ₹2,671 crore in March 2020 to ₹4,353 crore in March 2025. This growth is supported by reserves that have expanded to ₹4,261 crore, indicating retained earnings and capital infusion efforts. The company’s total liabilities have remained relatively stable around ₹7,500 crore, with total debt reducing slightly to ₹1,859 crore in the latest year from ₹2,112 crore in March 2024.
Long-term borrowings have increased to ₹1,211 crore in March 2025, up from ₹891 crore the previous year, while short-term borrowings have decreased, suggesting a shift in debt structure. The net block of fixed assets has declined moderately to ₹2,391 crore, reflecting depreciation and asset management strategies. Capital work in progress and intangible assets under development have increased, signalling ongoing investment in growth and innovation.
Cash Flow and Liquidity Analysis
Cash flow from operating activities has been inconsistent, with a negative ₹22 crore in March 2025 following a positive ₹219 crore in the prior year. Investing activities have seen significant outflows, notably ₹780 crore in the latest fiscal year, indicating capital expenditure and strategic investments. Financing activities provided a positive cash inflow of ₹409 crore, supporting liquidity needs and debt servicing.
The company’s closing cash and cash equivalents stood at ₹112 crore in March 2025, down from ₹505 crore the previous year, reflecting tighter liquidity conditions. Working capital management remains a challenge, with net current assets improving to a positive ₹423 crore in March 2025 from negative positions in prior years.
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Summary and Investor Considerations
Wockhardt’s historical performance reflects a company navigating through operational and financial headwinds, with fluctuating revenues and persistent net losses over the past six years. The recent improvement in operating margins and reduction in short-term debt are positive indicators, yet the company continues to face challenges in achieving sustained profitability and cash flow stability.
Investors should weigh the company’s ongoing investments in intangible assets and capital work against its debt levels and liquidity position. The balance sheet strength has improved, but the path to consistent profitability remains uncertain. Careful analysis of market conditions, competitive positioning, and management strategy will be essential for those considering exposure to Wockhardt’s stock.
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