Indian drugmaker Cipla tops Q2 profit view on solid domestic, N.America sales
Bengaluru: Cipla, India’s third-largest generic drugmaker by sales, posted a bigger-than-expected rise in second-quarter profit on Friday, boosted by strength in its key domestic and North American business.
The company’s consolidated net profit climbed 43.4 per cent to 11.31 billion rupees ($135.90 million) in the quarter ended Sept. 30, beating analysts’ average estimate of 9.75 billion rupees, as per LSEG data.
Total revenue from operations rose nearly 15 per cent to 66.78 billion rupees, led by a 13.4 per cent growth in its mainstay pharmaceutical business, said Cipla, which makes generic respiratory and cancer drugs along with consumer-branded products such as pain reliever Omnigel.
Sales in North America climbed nearly 32 per cent, while its other key markets including India and South Africa posted a 10 per cent and 3.7 per cent growth, respectively.
Higher market share in cancer drugs Revlimid and Lanreotide and lower price erosion have helped Cipla’s sales in the North American market, analysts said.
“The strong Cipla numbers have set a positive tone for the large pharma results for the remainder of the quarter,” said Shrikant Akolkar, an analyst at Asian Markets Securities, adding that gross margins also benefitted from falling raw material costs.
Meanwhile, its domestic sales were boosted by price hikes and the addition of medical representatives, who promote and sell pharmaceutical products to healthcare professionals.
Cipla’s founding family has been keen to sell their 33.4 per cent holding entirely.
India’s Torrent Pharmaceuticals are in talks with private equity funds, including CVC Capital Partners and Bain Capital, to raise up to $1.5 billion to bid for Cipla, Reuters reported last month.
If the deal works out, it would be the largest in the Indian pharma sector, analysts said.
Cipla’s shares jumped as much as 4.1 per cent after the results and were up 1.9 per cent, as of 3:20 p.m. IST.
They have risen nearly 17 per cent in the September quarter, compared with a 12 per cent rise in the Nifty Pharma index.
Peer Dr Reddy’s Laboratories is also scheduled to post its quarterly results later in the day.
Source – ETHealth World
