Laurus Labs – Can be a great opportunity if the management is able to walk the talk wef Q4
Q3 FY 24 concall and results highlights –
Sales – 1195 vs 1545 cr ( down 23 pc )
EBITDA – 183 vs 404 cr ( down 55 pc, margins @ 15 vs 26 pc – steep decline. However, the gross margins were at 54 pc, up 1 pc YoY )
Net Profit – 23 vs 203 cr ( down 89 pc )
Segment wise revenues ( for 9M ending Dec 23 ) –
Formulations – 984 vs 747 cr, up 32 pc
Improved business in ARVs and arresting of price declines. Developed Mkt export formulations also picked up. Multiple product launches scheduled in US in next Qtr
APIs – 1800 vs 1895 cr, down 5 pc
Sales breakup of APIs –
ARVs – 61 pc, Onco APIs – 15 pc, Other APIs – 24 pc
New capacity addition in progress in the Onco APIs segment
CDMO – 686 vs 1939 cr, down 65 pc ( steep decline due large PO executed LY. Except for that, core business grew 30 pc )
Company has 50 plus projects in Phase – 1,2,3 + 10 molecules in commercial stages. Seeing good demand/enquiries for late stage NCE molecules
Animal Health contract has commenced commercial validation batches
800 cr capex in CDMO facilities is on track
Bio – 131 vs 80 cr, up 65 pc
Total – 3600 vs 4660 cr, down 23 pc
Management commentary –
Believe that capacity utilisations should improve wef Q4 and hence the company should be able to report significant margin recovery. The same was expected in Q3 but has been pushed back into Q4. Expect capacity utilisation to pick up in Q4 and EBITDA margins to cross 20 pc. The confidence for the same is coming from the order book lined up wef Q4. The same is expected to sustain in FY 25 as well
As the capacity utilisation improves, EBITDA margins should get a good bump up. Continued interest and CDMO enquiries is a very positive sign
The Animal health contract is a > 10 yr multi product contract for supply of 20+ APIs to Intervet GmbH, a subsidiary of Merk Animal Health Ltd
Company also has a > 10 yr ago-chem products CDMO contract at hand. Capex for the same is on. Commercial supplies may begin in H2 FY 25
Disc: hold a tracking position, will add more as and when better results start fructifying, biased, not SEBI registered
| Subscribe To Our Free Newsletter |
