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Akumentis Healthcare: Flat Revenue But Rising Profits in FY24

Akumentis Healthcare
Preeti Bali / 7:39 am / July 5, 2024

Akumentis Healthcare, a pharmaceutical company based in Thane, India, reported a relatively flat performance in terms of revenue for the fiscal year ending March 2024 (FY24). The company’s standalone financial statements, filed with the Registrar of Companies, reveal a modest increase of 2.8% in revenue, reaching Rs 398 crore in FY24 compared to Rs 387 crore in FY23.

Akum Drugs and Pharma Ltd. Sees Revenue Rise

It’s important to note that Akumentis Healthcare is a wholly-owned subsidiary of Akum Drugs and Pharma Ltd. While Akumentis itself experienced flat revenue growth, its parent company saw a more significant increase of 14.3% in revenue during the same period, reaching Rs 4,178 crore in FY24 from Rs 3,655 crore in FY23.

Focus on Medical Products

Established in 2010, Akumentis Healthcare primarily generates revenue through the sale of medicinal products, including creams and medications across various therapeutic areas such as dermatology, orthopedics, gynecology, critical care, cardiovascular health, diabetes, and pediatrics. Interest and other miscellaneous sources contributed a minor Rs 10 crore to the company’s overall income in FY24, bringing the total to Rs 409 crore.

Cost Management Strategies

Akumentis implemented cost-control measures that helped improve its margins despite the flat revenue growth. While employee benefits accounted for a significant portion of the company’s expenses (approximately 36.6% or Rs 122 crore) in FY24, controlled spending in this area played a key role in boosting profitability. Additionally, the cost of materials consumed remained relatively stable at around 31.5% (Rs 105 crore) of the overall expenditure.

Marketing and Overheads

Marketing and promotional activities, commissions paid to selling agents, travel expenses, legal fees, and other overheads contributed to Akumentis’ total expenditure of Rs 333 crore in FY24, reflecting a slight decrease from Rs 340 crore in FY23.

Profit Surge and Improved Margins

The company’s focus on cost management translated into a significant profit increase of 62.9%. Akumentis’ profit climbed to Rs 57 crore in FY24 compared to Rs 35 crore in the previous fiscal year. This led to a notable improvement in both ROCE (Return on Capital Employed) and EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) margins, reaching 57.46% and 62.90%, respectively. Notably, Akumentis managed to maintain a healthy efficiency ratio, spending only Rs 0.84 to earn each rupee of revenue.

Leadership Change and Past Funding

In February 2020, Rajaram Samant, who co-founded Akumentis Healthcare and served as CEO for nearly a decade, stepped down from his position. Samant previously held leadership roles at prominent pharmaceutical companies like Ranbaxy, Emcure, and Wanbury. It’s also worth mentioning that Peak XV led a $19 million funding round for Akumentis in 2015.

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