Equity Note on ACI Limited Date: 16th January, 2022

Current Price (BDT): 288.60 Sector: Pharmaceuticals & Chemicals

Company Fundamentals Company Overview

DSE Ticker ACI ACI Limited, one of the largest conglomerates in
Market Cap (BDT mn) 21,134.4 Bangladesh that operates through Strategic Business
Equity Market weight 0.4% Units i.e. Pharmaceuticals, Consumer Brands, Agro
No. of Share Outstanding 63.1 business & Retail chain. They are engaged in
(mn) manufacturing of pharmaceuticals, consumer goods,
Paid-up Capital (BDT mn) 631.1 animal health care products, and marketing them along
Free-float Shares 64.7% with fertilizer, seeds and other agricultural items. ACI’s
(Inst.+For.+Public) “Shwapno” is the largest retail chain of the country.
3 Months Average 56.0
Turnover(BDT mn) Company Profile
Yearly Return 12.5%  Incorporation: 24 January, 1973
52-week price range (BDT) 221.0 - 351.2  Key personnel: M. Anis Ud Dowla (Chairman), Arif
NAVPS (2020-21) 176.0 Dowla (Managing Director) and Pradip Kar
Chowdhury (CFO).
 Shareholding Pattern:
2018-19 2019-20 2020-21 2021-22
(3m. A) Sponsor/ Gov.t Institute Foreign Public
Director
Financial Information (BDT mn):
Net Sales 59,844 66,124 76,308 86,214 November 31, 2021 35.28% 0.00% 40.56% 0.00% 24.16%
Operating Profit 3,474 4,070 5,249 6,828 October 31, 2021 35.28% 0.00% 41.85% 0.00% 22.87%
Profit After Tax (775) (1,059) 347 992 As on June 30, 2020 35.28% 0.00% 41.16% 0.00% 23.56%
Assets 61,344 61,563 72,099 73,677
Production Capacity: Production Capacity in
Long Term Debt 8,079 8,272 7,843 6,959
Pharmaceuticals, Consumer Goods and Animal Health is
Equity 9,226 7,290 11,103 11,378
7.50 mn units pack per 8hr/months where on average
Dividend (C/B)% 100/15 80/10 65/15 -/-
121.66% was utilized in FY 2020-21 as per Annual
Margin
report of the company.
Gross Profit 30.6% 29.5% 28.5% 28.9%
Operating Profit 5.8% 6.2% 6.9% 7.9% Subsidiary Details
Pretax Profit 0.3% -0.2% 2.9% 3.8% Name Nature of Business % of
Net Profit -1.3% -1.7% 0.5% 1.2% ownership
Growth: ACI Manufacturing and
Sales 14.6% 10.5% 15.4% 13.0% Formulations marketing of agrochemicals 53.5
Gross Profit 25.6% 7.4% 7.1% 21.8% Ltd. and consumer goods
Operating Profit 12.7% 17.1% 29.0% 30.1% Manufacturing and
Net Profit -49.9% -36.6% 32.8% 186% ACI Salt Ltd. marketing of Edible branded 77.7
Profitability: salt
ROA -1.3% -1.7% 0.5% 1.3% Manufacturing, processing
ACI Foods
ROE -7.8% -12.8% 3.8% 8.8% and marketing food items 99.3
Ltd.
Leverage:
Debt Ratio 65.1% 78.9% 51.8% 65.0% Milling, processing,
ACI Pure
Debt-Equity 480.1% 666.1% 336.4% 421% packaging and marketing of 95.0
Flour Ltd.
Int. Coverage 1.04 0.89 1.48 1.93 wheat flour products
Valuation: Manufacturing, Formulating
and packaging pesticide,
Price/Earnings (20.3) (12.2) 47.9 16.8 ACI Agrolink
fertilizer, plant nutrient, 90.0
Price/BV 1.7 1.8 1.5 1.4 Ltd.
animal food and other
EPS (BDT) (13.5) (16.8) 5.5 15.7
nutrient foods
DPS (BDT) 11.5 9.0 8.0 n/a
Buying, selling, importing
NAV per share 160.8 115.5 175.9 180.3 ACI Motors
and assembling of vehicles 52.70
(BDT) Ltd.
*Financial data of 2020-21 has been annualized based Creative Managing Media solutions.
on latest Q1 data. Communicati 60.0
on Ltd.
Price Volume Movement of ACI Ltd. Manufacturing and
marketing of plastic
Premiaflex
products, flexible printing 87.3
400 1400 Plastics Ltd.
and other ancillary
350 1200 business.
Volume (in 000)

300 1000 Improvement of marketing

Share Price

250 ACI Logistics

800 goods through setting up 76.0
200 Ltd.
150
600 nationwide retail outlets.
100 400 Manufacturing and trading
200 of all kinds of crude and
50 ACI Edible
0 0 refined edible oils, edible 85.0
Oils ltd.
fats, food grade chemicals
etc.

Volume(Qty) CLOSEP*

1 EBL Securities Limited Research

 Equity Note on ACI Limited Date: 16th January, 2022
Current Price (BDT): 288.60 Sector: Pharmaceuticals & Chemicals

Manufacturing and Chain, and Food segment contributed the most to

ACI
marketing of the revenue of the conglomerate at 18.7%, 17.4%,
Healthcare 92.94
pharmaceuticals products 13.9%, and 8.6% respectively during the first 3
Ltd.
for regulated markets. months of FY2021-22. However, key positive
ACI Representing, marketing contributor segments to the profit (before tax) were
Chemicals and promoting products of 75.0 Pharma (94.60%), Motors (56.00%) and Salt
Ltd. local and foreign principals. (16.16%) whereas key negative contributors were
Manufacturing and sale of Healthcare (-53.60%) and Retail Chain (-37.30%).
ACI Biotech
mosquito coil. 80.0
Ltd.  ACI Healthcare has been a big negative contributor
to the profit of the company. Revenue decreased by
Development of computer
Infolytx software, e-commerce, 6.8% during Q1 of 2021-22. However, profit before
Bangladesh information technology, 60.0 tax, despite being negative, has shown signs of
Ltd. communication and improvement: Profit before tax in Q1 2021-22
marketing. stood at negative BDT 438.939 million from
ACI Marine Manufacturing marine and negative BDT 459,346 million in Q1 2020-21- a
and Riverine riverine vehicles, slight growth of 4%. The subsidiary, established to
77.0
Technologies accessories, and providing manufacture and market pharmaceuticals products
Limited related services to the US, has focused on Bangladeshi market as it
awaits US FDA inspection and approval for its
Joint Venture Company Details factory at Sonargaon.
Name Nature of business Ownership  ACI Logistics (Shwapno) posted BDT 2,999.10
Ratio million revenues and BDT 303.27 million net loss
ACI Godrej Agrovet Manufacturing and 50:50 before tax during the July to September of FY 2020-
Private Ltd. (India) selling of animal foods 21 against BDT 2,968.54 million revenue and BDT
 Global tea 50:50 346.85 million loss before tax during the same
sourcing and period of the previous year representing 1.00% YoY
blending growth in revenue and 13.00% YoY growth in profit
Tetley ACI
 Introducer of before tax. On a positive note, the retail chain has
(Bangladesh) Ltd.
India’s largest tea been reporting positive EBITDA since FY 2019-20.
brand “Tata Tea” It is now focusing on making the profit before tax
in Bangladesh
number positive. (New Age, 2021)
Associate company Details  On a positive note, ACI Pharma and Motors
Name % of ownership respectively witnessed 28.3% & 46.3% YoY growth
Asian Consumer Care (Pvt) Ltd. 24.0 in revenue and 19.2% & 12.2% YoY growth in profit
ACI CO-RO Bangladesh Ltd. 50.0 before tax during the period. Profit (before tax)
Computer Technology Ltd. 40.0 contribution of these concerns decreased to
Stochastic Logic Ltd. 20.0 94.60% & 56.00% in July’21-September’21 periods
Investment Profile other than subsidiary, from 158.10% & 64.30% respectively in the same
associates and joint ventures: As on January 02, period of previous financial year as other
2022, ACI Ltd. holds 3.33% shares in Mutual Trust Bank subsidiaries showed signs of improvement and
Ltd. and 0.58% shares of Central Depository contributing more to the consolidated figure.
Bangladesh Ltd.  Also, ACI Crop Care & Public Health subsidiary has
shown a robust YoY revenue growth of 28.10% &
Performance of ACI Limited & its Subsidiaries: profit growth of 75% during the period respectively.
As per the latest first quarter financial statement for FY The contribution has also raised by 14.48% in
2020-21, ACI Limited & its Subsidiaries recorded July’19-March’20 periods from 12.07% in the same
18.20% average growth on YoY basis. ACI Limited’s period of previous financial year.
solo operation (Composed of Pharma, Consumer Brands
and Agribusiness Segment) served as the core revenue
sources with about 31.3% revenue contribution from Industry Overview
the parent company to the conglomerate in the first 3 Pharmaceutical sector overview: Pharmaceutical
months of FY2021-22. Besides, its subsidiary ACI Industry, one of the fastest growing industry in
Logistics that runs retail chain Shwapno contributed Bangladesh, has shown a significant growth potential
around 13.9% of the total revenue during the period. with a growth rate of 17% for the years 2014 to 2020
On solo basis, ACI Limited reported BDT 7,638.988
(Bangladesh Investment Development Authority,
million revenue and BDT 644.69 million net profit with
2020). The domestic market size is now approximately
12.02% and 23.77% growth respectively on YoY basis.
USD 3 billion (International Trade Administration, U.S.
 Out of 11 business segments under different Department of Commerce, 2021). According to a report
subsidiaries of the conglomerate, 6 has reported from a Dublin-based market insight and analysis firm,
sound growth in net profit (before tax) and the rest Research and Markets, the pharmaceutical industry of
5 has shown negative growth in the first quarter of Bangladesh will surpass USD 6 billion by 2025. (The
2021-22. Despite 45% of the subsidiaries reporting Daily Star, 2020)
negative growth, the conglomerate has shown a
positive profit growth of 110% and a revenue
growth of 18.20% during the first 3 months of FY
2021-22 on a YoY basis. Segment wise business
performance reveals that Pharma, Motors, Retail

2 EBL Securities Limited Research

 Equity Note on ACI Limited Date: 16th January, 2022
Current Price (BDT): 288.60 Sector: Pharmaceuticals & Chemicals

Bangladesh Pharmaceutical Industry Market The worldwide pandemic of coronavirus has emerged as
Size Projection USD bn a new opportunity for pharma industry. The escalated
trade war between US and China is making the US to
reconsider its overdependence on China that made a

5.92
new opportunity for developing countries including

5.29
4.72
Bangladesh. Bangladesh pharma industry has the
4.21
3.76

competitive advantages over its competitors in the

3.36
3.00

global market for generic medicines and if utilized

2019 2020 2021 2022
Source: The Daily Star, EBLSL
Moreover, export of Pharmaceutical product has
experienced an upward trend over the last couple of
years. In FY 2020-21, the pharmaceutical industry
fetched USD 169 million in exports- a year-on-year
growth of 25% (Bangladesh Investment Development
Authority, 2020).
Pharmaceuticals Export Trend USD mn
20 0
properly, it can make a mark in the global market.
2023 2024 2025 But, the country's pharmaceutical industry is heavily
dependent on imports for raw materials. Over 90
percent of Active Pharmaceutical Ingredients (API)
needs to be imported with majority coming from China
and India. The government formulated the API and
Laboratory Reagents Production and Export Policy in
2018 to reduce dependence on API imports. An API park
is also being established that is expected to open this
year. The API Park can cut costs of raw material imports
by 70%. The cost cutting can make Bangladesh’s
pharmaceutical industry more cost competitive.
Especially as Bangladesh will lose TRIPS exemption
facilities as it graduates from its LDC status and
companies will incur higher import costs of generic
169

15 0

drugs.
136

FMCG Sector overview: Growth of market size of this

130

10 0

sector is mostly dependent on population growth in the

103
89
82

50

economy and also the income condition (purchasing

power) of consumers. The Bangladeshi branded FMCG
industry has been growing at 9 percent annually with a
0

2015-16 2016-17 2017-18 2018-19 2019-20 2020-21
Source: Export Promotion Bureau website
Bangladesh usually produces branded-generic drugs
(75% manufacturers produce generic drugs. (Cision PR
Newswire, 2020). This trend is helping established
brands in the market to charge premium for their
products. Market is concentrated among few companies
(Only five companies hold 46.66 per cent of the market
share) and entry barrier is higher due to large capital
investment and legislative bindings. (The Financial
Express, 2019)
The domestic pharmaceuticals market is dominated by
six major players. Top 6 companies hold approximately
53% of the total market share. Square Pharmaceutical
is the market leader having 18.8% market share
followed by Incepta, Beximco, Opsonin, Renata and
Eskayef. Below pie chart shows the current market
share held by leading pharmaceutical companies (The
Daily Star, 2020).
Domestic Pharmaceutical Market Share in
percentage
18.8
38.81
10.2
8.5
3.52 5.6
4.11
4.38 4.5 5.1
Source: The Daily Star
total size of $3.4 billion as of 2017. (LIGHTCASTLE ,
2020)
Bangladesh’s consumer class is projected to double by
the end of this decade: In 2020, the size of the
consumer class was 35 million. By 2030, the size will be
85 million. (Brookings Institution, 2021) This growth
potential of the consumer class will make Bangladesh
an attractive place for the FMCG industry.
However, global pandemic of COVID-19 and any future
variant spread will impact the FMCG industry the most.
In the short run, the industry need to meet the
increasing demand for personal hygiene products such
as sanitizers and soaps and grapple supply chain issues
if lockdowns are imposed. In the long run, the economic
downturn and the persisting inflation will reduce
consumers’ purchasing power while increasing raw
material prices for manufacturers.
Autos Sector overview: The Bangladesh automobiles
market is worth USD 1 billion (LightCastle Partners,
2020). Prior to the pandemic, the automobile market
has been growing at a rate of 15-20% every year while
the auto parts market grew at 12%. Of the more than
46 lakh registered motor vehicles in the country, 80%
of them are two-wheelers. (The Business Standard,
2021)
Fueled by the economic development of the country
Square
Incepta
that leads to improved lifestyle and higher purchasing
Beximco power among middle income class people, Bangladesh
two wheelers market has experienced a faster growth.
Opsonin
Reneta Since 2016-17, market began to expand fast mainly
Eskayef due to Govt. favorable policy i.e. reduction in
ACI supplementary duty on motorcycle parts import to 20%
Aristopharma from 25% for local manufacturers, reduction of two-
Acme wheels registrations cost by 75%.
Others
While 70% of the parts have to be imported, this policy
represented a huge financial blessing for the local
producers. Before, local manufacturers produced less
than 250,000 units every year. After the policies were

3 EBL Securities Limited Research

 Equity Note on ACI Limited
Current Price (BDT): 288.60
implemented, volume doubled to 487,000 units in 2018
and over 549,000 units in 2019. At present, around 80
percent of motorcycles running in the country have
either been locally manufactured or assembled.
However, the long run of the motorcycles industry had
been braked by the first wave of COVID-19 back in
2020. That year, the market declined, for the first time,
by 9.3% (MotorCycles Data, 2021). However, the
industry rebounded and by 2021, average sales of
motorcycles stood at 33,329 units per month compared
to 25,918 units per month in 2020. (The Daily Star,
2021)
Investment Insight
Company Positive
 After two consecutive years of losses, ACI Limited
has finally returned to profitability. In FY 2020-21,
net profit amounted to BDT 347 million against a
loss of BDT 1,322 million in FY 2019-20. It can be
expected that the conglomerate will maintain its
profitability in the coming days. It already recorded
a net profit of BDT 301.29 million in Q1 of FY 2021-
22: that is covering 86 percent of the profit it made
overall in the last fiscal year.
 The conglomerate is reducing its levered position.
Interest expense has been reduced by 22 percent
from BDT 4.57 million in FY 2019-20 to BDT 3.55
million in FY 2020-21. Debt-to-equity ratio reduced
from 666.1% to 336.4% while debt-to-asset ratio
reduced from 78.9% to 51.8% during the same
time interval. Operating expenses, as a percentage
of revenue, has declined from 23.3% to 21.6%.
These reductions in financial and operating
expenses, along with a sales growth of 15% has
helped improve profit margins for the
conglomerate. Margin ratios from annualized Q1 FY
2021-22 figures show the numbers further
improved.
 At the onset of COVID-19, Shwapno introduced
telesales service that has brought in 11,000
monthly customers. Its presence in e-commerce
platforms has brought in 30,000 monthly orders
while physical stores bring in 14,000 visitors daily.
In FY 2020-21, Shwapno added 52 outlets. The
increase in visitors, both online and retail have
helped revenue to increase by 18.7% in Q1 FY
2021-22 on a year-on-year basis. The retail chain
reported operating profit in the months of May and
June 2021. Profit-before-tax (PBT), though, still
negative, has improved: PBT in Q1 FY 2021-22 was
negative BDT 1,318 million compared to BDT 1,482
million in FY 2020-21.
 In FY 20-21, ACI Motors Farm mechanization unit
ensured 27% growth over last year. ACI Motors’
Tractor brand Sonalika has continued market
leadership with 36% market share. The subsidiary’s
power tiller also maintained leading position in its
category.
 ACI Motors has started manufacturing of 150 CC
Yamaha motorcycle (FZS V3) from May 2021.
Yamaha motorcycle had experienced growth of
15% and maintained 6% market share.
 Premiaflex Plastics Limited has been able to
generate a positive profit-before-tax in FY 2021-22.
In the reported period, the producer of premium
plastic and flexible packaging products posted
4 EBL Securities Limited Research
Date: 16th January, 2022
Sector: Pharmaceuticals & Chemicals
profit-before-tax of BDT 58.09 million- a 113%
growth from negative BDT 460.37 million in FY
2020-21.
 ACI Food division has been able to generate a
profit-before-tax growth of 166% from BDT 16.88
million in Q1 FY 2020-21 to BDT 44.95 million in Q1
FY 2021-22. Revenue grew 23% from 1.51 million
to 1.86 million during the same time period.
 ACI Salt’s revenue grew 89% and PBT grew 166%
in Q1 of FY 2021-22 on a Y-o-Y basis.
Investment Concern
 As mentioned before, out of 11 business segments
under different subsidiaries of the conglomerate,
only 6 has reported sound growth in net profit
(before tax) during the 1st quarter of 2020-21.
Compared to the 1st quarter of the previous fiscal
year, the number of subsidiaries reporting loss has
increased from 4 in Q1 FY 2020-21 to 5 in Q1 FY
2021-22.
 Although the Premiaflex Plastics has shown 10%
growth in revenue, it has again faced a reversal in
its profit before tax figures. In Q1 of FY 2020-21,
its PBT was BDT 25,627 million that turned to
negative BDT 47,666 million in Q1 of FY 2021-22.
 The consumer brand division has been recording
loss since 2019 and during the 1st quarter of
FY2020-21, profit before tax and revenue de-
growth stood at 1629% and 19.9% respectively.
This degrowth is despite the sudden surge in
demand of the health and hygiene products such as
Antibacterial Soap, Sanitizer, disinfectant etc.
during the lockdown where ACI has several
established brands in this category.
 ACI Healthcare has been showing revenue de-
growth of 6.8% in the 1st quarter of FY2020-21.
Though the concern has shown a slight
improvement in its profit-before-tax figures
compared to the first quarter of last fiscal year, the
balance is still in the negative. The subsidiary is still
waiting for approval of its US factory from the FDA
that has been halted due to the pandemic. The rise
of the new Omicron variant can further hamper the
approval.
 Continued loss in ACI Logistics Ltd. (Shwapno) is
eating up a significant portion of the
conglomerate’s net profit after tax over the year.
During FY 2020-21, accumulated loss recorded as
BDT 13,743.88 million. However, profit after tax,
though still negative, and have improved from
negative BDT 1,569.39 million in FY 2019-20 to
negative BDT 1,420.15 million in FY 2020-21.
 Despite improvements, the conglomerate is
still a highly levered company. As on
September 2021, debt-equity ratio of the
company stood at 115.59% which made the
company exposed to high financial and
business risk. The conglomerate has increased its
short term borrowing in FY 2020-21: Short term
bank loans increased by 45% from the last fiscal
year. The increase in short term borrowing has led
to an increase in current liabilities that has reduced
the quick and cash ratios of the company. This
significant finance cost has been consistently acting
as one of the major causes of lower performance.
 As the company imports most of its raw materials
for production, it is exposed to exchange rate risk
and according annual report 2018-19, continued
 Equity Note on ACI Limited Date: 16th January, 2022
Current Price (BDT): 288.60 Sector: Pharmaceuticals & Chemicals

devaluation of local currency against foreign

currency made a big impact on their profitability. Profitability Margin of ACI Ltd.
Though the company has returned to profitability,
further devaluation can hurt profitability once
again.
 Due to the global supply chain disruption as a

30.61%
30.38%

29.46%
repercussion of global pandemic, raw materials

28.46%
sourcing and hence, timely production has become

6.88%
6.15%
5.90%

5.81%
2.72%

2.87%
difficult for the company. ACI Motor’s Yamaha

-0.15%
0.99%

-1.60%

0.45%
-1.29%
0.28%
inventory, for example, was unavailable from
August 2020 to January 2021 as a result of the
disruption. The subsidiary estimated it would have 2017-18 2018-19 2019-20 2020-21
gained an additional 2% market share if the
disruptions did not take place.
 Dividend per share (DPS) has been consistently Gross Profit Operating Profit Pre Tax Profit Net Profit
decreasing over the years as earnings took a dip.
DPS was BDT 11.5 per share in FY 2018-19, which Source: Annual reports
declined to BDT 9.00 and BDT 8.00 per share in FY
2019-20 and FY 2020-21 respectively. However,
Pricing Based on Relative Valuation:
with the increase in the company’s potential
earnings, it can be expected that DPS will also EPS* Multip Value
increase. Sector P/E* 6.90 112.6 le (BDT)
778
 The earnings growth of the company is highly 12-m trailing ACI P/E 5.50 48.22 0 265.20
volatile. But EPS growth has been positive since Q4 Sensitivity Analysis
of FY 2019-20. Yearly EPS has also been in a Price @46x PE 6.90 46x 317.4
positive trend. Price @48x PE 6.90 48x 331.2
Price @50x PE 6.90 50x 345.0
Yearly EPS and EPS Growth *Sector P/E calculated as an average of the P/Es (based
EPS Growth on last audited statements) of selected 12 listed
20.00 300%
15.72 companies in DSE
15.00
10.36 200%
Concluding Remarks:
GROWTH RATE (%)

10.00
5.50 100%
5.00 Despite the increase in number of subsidiaries reporting
negative profit before tax numbers in Q1 FY 2021-22,
EPS

0.00 0%
-5.00
ACI Limited has a better consolidated profit before tax
-100% figure than the same quarter of the previous fiscal year.
-10.00
The conglomerate has been able to return back to
-200%
-15.00
(13.51) profitability as well as reduce its highly leveraged
-20.00 (16.78) -300% position.
2017-18 2018-19 2019-20 2020-21 2021-22
Future concerns remain about the possibility of future
*Financial data of 2021-22 has been annualized COVID variant outbreaks that will impact production,
based on Q1 data. inflation that will impact sales, and currency
depreciation that will impact raw material prices.
Quarterly EPS (BDT) However, ACI Limited and its subsidiaries have been
able to adapt to the changing situation quickly. For
3.93 example: ACI Healthcare, while waiting for approval
1.54 1.65 1.96 from the US FDA, switched to manufacture products for
0.41 0.35 the local market last year. Premiaflex, on the other
hand, switched to toy category products to subsidize
the loss of revenue from non-necessary goods.
As long as the conglomerate maneuvers its subsidiaries
-5.21 -4.81 to the current changing conditions, it can increase
-6.35 performance and improve results.
Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1
Sources: Annual Reports, DSE Website, Company
2019-20 2020-21 2021- website, the Financial Express, the Daily Star and EBLSL
22 Research
Source: Annual and quarterly reports

5 EBL Securities Limited Research

Equity Note on ACI Limited Date: 16th January, 2022
Current Price (BDT): 288.60 Sector: Pharmaceuticals & Chemicals

STATEMENT OF COMPREHENSIVE INCOME

Particulars Year 2016-17 Year 2017-18 Year 2018-19 Year 2019-20 Year 2020-21 Year 2021-22
Q1 An’
Net Turnover 44,993,237,247 52,217,642,216 59,844,749,402 66,124,401,242 76,308,881,484 86,214,688,000
Cost of Goods Sold 33,563,743,344 40,257,620,969 44,826,113,310 49,991,773,844 59,032,686,076 61,665,036,000
GROSS PROFIT 11,429,493,903 11,960,021,247 15,018,636,092 16,132,627,398 17,276,195,408 24,549,652,000
Other Operating Income 2,674,790,361 3,905,678,892 3,298,945,840 3,350,886,563 4,439,521,681 301,100,000
Total Operating Income 14,104,284,264 15,865,700,139 18,317,581,932 19,483,513,961 21,715,717,089 24,850,752,000
Operating Expenses 10,901,743,654 12,782,328,798 14,843,172,576 15,413,733,052 16,467,045,135 18,022,092,000
Profit from operations 3,202,540,610 3,083,371,341 3,474,409,356 4,069,780,909 5,248,671,954 6,828,660,000
Financial Expenses 1,457,820,520 2,231,054,208 3,329,768,907 4,571,407,759 3,552,575,030 3,538,164,000
Other Non Operating 82,477,299 161,703,349 10,037,945 261,633,957 310,298,388
Income
Gain on Sale of Brand 403,900,000 540,300,000
Share on profit (loss) on 143,913,167 35426012 161,076,381 367,008,180 472,515,593 319,776,000
associate (net of tax)
PROFIT BEFORE WPPF 2,375,010,556 1,589,746,494 315,754,775 127,015,287 2,478,910,905 3,610,272,000
Allocation for WPPF 186,023,965 168,083,901 146,239,765 225,641,786 291,774,335 334,332,000
PROFIT BEFORE TAX 2,188,986,591 1,421,662,593 169,515,010 -98,626,499 2,187,136,570 3,275,940,000
Provision for Income Tax 1,166,431,472 1,374,709,885 1,386,439,405 1,684,241,935 1,945,997,887 2,070,796,000
Provision for Deferred (13,393,333) -363,597,434 -282,988,259 -460,512,750 -195,924,013
Income Tax
PROFIT AFTER TAX 1,035,948,452 410,550,142 -933,936,136 -1,322,355,684 437,062,696 1,205,144,000
Non-controlling interest (29,214,972) (106,464,183) (159,029,704) (263,596,778) 89,892,038 212,528,000
PROFIT AFTER TAX FOR THE 1,065,163,424 517,014,325 -774,906,432 -1,058,758,906 347,170,658 992,616,000
YEAR
Total Comprehensive 1,065,163,424 517,014,325 -774,906,432 -1,058,758,906 347,170,658 992,616,000
Income for the Year
EPS (Basic) 22.10 10.36 -13.51 -16.78 5.50 15.73

6 EBL Securities Limited Research

Equity Note on ACI Limited Date: 16th January, 2022
Current Price (BDT): 288.60 Sector: Pharmaceuticals & Chemicals

STATEMENT OF FINANCIAL POSITION

Particulars Year 2016-17 Year 2017-18 Year 2018-19 Year 2019-20 Year 2020-21 Year 2021-22
An.
Non-Current Assets: 21,122,843,067 26,646,908,645 29,305,735,266 31,159,665,027 34,617,909,412 34,610,680,000
Property, Plant and 19,453,928,098 23,017,048,759 25,570,747,581 26,682,430,648 29,821,715,259 29,731,165,000
Equipment-Carrying Value
Intangible Assets, net 85,910,725 735,339,955 103,177,750 115,683,193 93,940,460 88,534,000
Other Investment 515,115,470 118,237,964 848,208,350 777,345,035 810,605,689 801815000
Equity Accounted Investee 1,067,888,774 1,143,314,786 1,304,391,166 1,668,821,756 1,927,912,599 2,007,856,000
Other Non-Current Assets 1,632,967,181 1,479,210,419 1915384395 1963735405 1981310000
Current Assets: 25,847,175,402 27,724,831,940 32,038,666,999 30,403,157,777 37,481,746,399 39,066,207,000
Inventories 10,550,939,071 11,792,577,831 13,560,088,685 12,545,671,650 17,349,949,096 18,817,291,000
Trade Debtors 8,530,045,056 10,963,329,914 13,827,165,973 12,212,918,829 12,015,538,374 12,060,602,000
Other Debtor 912,543,208 1,099,973,493 509,581,982 670,119,195 815,433,268 835,512,000
Advances,Deposits and 4,328,616,073 1,726,492,900 1,771,258,032 2,082,001,900 2,300,941,553 2,078,942,000
Prepayments
Inter-Company Receivables 13,277,557 10,907,763 50,583,865 9,524,610 9,585,811 9,477,000
Short Term Investment 1,070,000,000 1,158,369,377 1,172,704,000
Cash and Cash Equivalents 1,511,754,437 2,131,550,039 2,319,988,462 1,812,921,593 3,831,928,920 4,091,679,000
TOTAL ASSETS 46,970,018,469 54,371,740,585 61,344,402,265 61,562,822,804 72,099,655,811 73,676,887,000
Shareholders' Equity: 10,639,058,947 10,775,489,383 9,226,513,864 7,289,977,438 11,103,051,059 11,378,195,000
Share Capital 438,204,010 482,024,411 498,895,266 573,729,556 631,102,500 631,103,000
Share Premium 402,310,367 402,310,367 402,310,367 402,310,367 928,707,434 928,707,000
Capital Reserve 4,579,908,446 4,744,427,788 4,833,537,172 4,711,254,886 7,084,648,991 7,058,690,000
Retained Earnings/ Revenue 5,153,137,802 5,254,735,490 3,843,831,804 2,211,343,343 1,620,384,642 1,868,538,000
Reserve
Non Controlling Interest 65,498,322 -108,008,673 -352,060,745 -608,660,714 838,207,492 891,157,000
Non-Current Liabilities: 6,663,794,092 10,691,927,362 10,535,573,328 10,819,370,525 10,467,865,353 9,633,446,000
Long Term Loans - Secured 5,151,447,744 7,972,367,343 8,079,177,445 8,271,767,701 7,843,747,173 6,959,462,000
Liabilities for Gratuity 788,032,113 994,107,784 1,178,872,434 1,367,018,271 1,462,875,059 1,582,846,000
Obligation under finance lease 1,361,850,591 1,203,077,745 1,180,584,553 1,161,243,121 1,091,138,000
Deferred Tax Liability 724,314,235 363,601,644 74,445,704
Current Liabilities: 29,667,165,427 32,904,323,842 41,582,315,073 43,453,474,844 50,528,739,396 52,665,247,000
Bank Overdraft 1,696,737,293 4,159,153,500 4,618,176,594 4,440,893,673 3,543,943,716 5,510,491,000
Short Term Bank Loans 19,680,268,387 21,933,605,080 27,263,916,795 22,822,007,267 32,274,988,314 35,432,302,000
Long Term Loans - Current - 4,466,281,007 2,241,433,061
Portion
Trade Creditors 2,347,414,417 2,252,947,112 4,338,090,506 4,897,372,492 4,540,656,791 4,560,914,000
Other Creditors 3,325,117,640 3,924,141,882 4,699,441,016 5,915,761,374 7,303,909,434 6,455,885,000
Inter-Company Liabilities -
Current Tax Liabilities 2,617,627,690 358,264,970 283,158,780 335,539,266 58,607,638 205,054,000
Unclaimed Dividend 173,531,474 131,177,139 80,761,000
Obligation under finance lease 276,211,298 379,531,382 402,088,291 434,023,303 419,840,000
TOTAL SHAREHOLDERS' 46,970,018,469 54,371,740,585 61,344,402,265 61,562,822,804 72,099,655,811 73,676,887,000
EQUITY AND LIABILITIES
Net Asset Value (NAV) per 9.99 20.84 (11.91) (6.89) 31.98 11.46
share
No. of Share Outstanding 1,065,163,424 517,014,325 (774,906,432) (1,058,758,906) 347,170,658 992,616,000

7 EBL Securities Limited Research

Equity Note on ACI Limited Date: 16th January, 2022
Current Price (BDT): 288.60 Sector: Pharmaceuticals & Chemicals

RATIO ANALYSIS
Year 2016-17 Year 2017-18 Year 2018-19 Year 2019-20 Year 2020-21 Year 2021-22
An*
Liquidity Ratios:
Current Ratio 0.87 0.84 0.77 0.70 0.74 0.74
Quick Ratio 0.52 0.48 0.44 0.41 0.40 0.38
Cash Ratio 0.05 0.06 0.06 0.11 0.06 0.10
Operating Efficiency Ratios
Inventory Turnover Ratio 3.54 3.60 3.54 3.83 3.95 0.85
Receivable Turnover Ratio 6.24 5.36 4.83 5.08 6.30 1.79
Average Collection Period (Days) 57.73 67.20 74.56 70.88 57.15 201.07
Inventory Conversion 101.64 99.90 101.80 94.00 91.16 422.29
Period(Days)
Operating Cycle (Days) 159.37 167.10 176.37 164.88 148.31 623.35
A/C Payable Turnover Ratio 16.54 12.84 12.90 9.75 12.51 3.39
Payables Payment Period (Days) 21.76 28.04 27.92 36.92 28.78 106.27
Cash Conversion Cycle (Days) 137.61 139.06 148.45 127.96 119.53 517.08
Total Asset Turnover 1.08 1.03 1.03 1.08 1.14 0.30
Fixed Asset Turnover 2.65 2.46 2.46 2.53 2.70 0.72
Operating Profitability Ratios
Gross Profit Margin (GPM) 31.35% 30.38% 30.61% 29.46% 28.46% 0.29
Operating Profit Margin (OPM) 7.12% 5.90% 5.81% 6.15% 6.88% 0.08
EBITDA 9.03% 7.91% 7.83% 8.50% 8.94% 0.14
Pre Tax Profit Margin 4.87% 2.72% 0.28% -0.15% 2.87% 0.04
Net Profit Margin (NPM) 2.37% 0.99% -1.29% -1.60% 0.45% 0.01
Return on Total Assets (ROA) 2.57% 1.02% -1.34% -1.72% 0.52% 0.00
Return on Equity (ROE) 10.40% 4.83% -7.75% -12.82% 3.78% 0.02
Leverage Ratios
Total Debt to Equity 2.49 3.37 4.80 6.66 3.36 4.21
Debt to Total Assets 0.56 0.67 0.65 0.79 0.52 0.65
Coverage Ratios
Times Interest Earned (TIE) 2.20 1.38 1.04 0.89 1.48 1.93
Cash Coverage Ratio 0.05 0.06 0.06 0.04 0.08
Valuation Ratios
Book Value Per Share 220.72 215.99 160.82 115.51 175.93 180.29
EPS 22.10 10.36 -13.51 -16.78 5.50 3.93
Growth Rates
Sales Growth Rate 29% 16% 15% 10% 15% -0.72
Gross Profit Growth Rate 4% 5% 26% 7% 7% -0.64
Net Income Growth Rate 24% -51% -250% 37% -133% -0.29
Net Profit AT/Sales 2.37% 0.99% -1.29% -1.60% 0.45% 0.01
Sales/Total Assets 108.37% 103.05% 103.43% 107.60% 114.18% 0.30
ROA 2.57% 1.02% -1.34% -1.72% 0.52% 0.00
Net Profit AT/Total Assets 2.57% 1.02% -1.34% -1.72% 0.52% 0.00
Total Assets/Stockholders Equity 405.37% 473.24% 578.52% 744.15% 726.70% 6.48
ROE 10.40% 4.83% -7.75% -12.82% 3.78% 0.02

8 EBL Securities Limited Research

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