Marksans Pharma- Can it be the next Pharma Biggie?

Marksans Pharma reported robust performance, with notable growth in revenue, gross profit, EBITDA, and net profit.

Q2FY24 Financial Highlights:

• Operating revenue reached Rs. 531.2 cr., marking a YoY growth of 17.4%, driven by increased demand and market share gains.
• Gross profit stood at Rs. 278.5 cr., a substantial YoY growth of 21.4%, with a gross margin of 52.4%.
• EBITDA experienced a significant surge of 41.9%, reaching Rs. 113.9 cr., with an EBITDA margin of 21.4%.
• Earnings per share (EPS) grew by 21.2% YoY, reaching Rs. 1.8.

H1FY24 Financial Highlights:

• Operating revenue for the half-year was Rs. 1,031.3 cr., showing a YoY growth of 16.3%, attributed to new product launches and gains in market share.
• Gross profit for H1FY24 was Rs. 535.8 cr., with a gross margin of 52.0%.
• EBITDA for H1FY24 reached Rs. 215.9 cr., reflecting a robust growth of 41.0%, with an EBITDA margin of 20.9%.
• EPS for H1FY24 grew by 12.3% YoY, reaching Rs. 3.4.

Business Highlights: US Market:

• The US & North America Formulation business reported a growth of 14.1% YoY in H1FY24, reaching Rs. 415.6 cr., attributed to market share gains, new product launches, and increased share of existing customers.
• The company has 32 products in the pipeline, including 20 oral solids and 12 ointments and creams.

UK and Europe Market:

• Revenue from the UK and Europe Formulation business in H1FY24 reached Rs. 459.2 cr., reflecting a strong YoY growth of 22.6%.
• Marksans Pharma has planned 34 new filings over three years, with 16 products already filed and awaiting approval.

Australia and New Zealand Market:

• The Australia and New Zealand business reported Rs. 107.0 cr. in H1FY24, growing by 10.9% YoY due to incremental market share.
• There are 10 products in the pipeline expected to be launched over two years.

Rest of World (RoW) Market:

• RoW business reported Rs. 49.5 cr. in H1FY24.

Other Highlights:

• Capex incurred in H1FY24 was Rs. 119.9 cr., aligned with the plan for scaling the acquired manufacturing unit from Teva Pharma in Goa.
• Cash balance at the end of September 30, 2023, is Rs. 661 cr.
• Cash from operations in H1FY24 is at Rs. 90.6 cr., and Free Cash Flow is at -29.3 cr., primarily due to high capex in the quarter.