CIPLA –
Q1 FY 25 concall and results highlights –
Revenues – 6694 vs 6329 cr, up 5 pc
Gross Margins @ 67.2 pc – up 226 bps YoY
EBITDA – 1716 vs 1494 cr, up 4 pc ( margins @ 25.5 vs 24 pc )
PAT – 1175 vs 998 cr, up 17 pc
Geography wise sales breakup –
India – 2898 cr, up 5 pc ( trade generics were adversely impacted in Q1 due change in distribution model. Business to be back on growth path wef Q2. Branded prescriptions grew @ a healthy 10 pc – led by respiratory, cardiac and urology therapies )
North America – 2075 cr, up 13 pc ( highest ever Qtly sales ) – Lanreotide 505(b)(2) mkt share @ 20 pc, Albuterol Mkt share @ 17 pc
South Africa branded – 494 cr, up 11 pc ( ranked no-1 in South Africa prescription mkt and no 3 in the OTC mkt ) – launched 8 new products across multiple therapies in Q1
South Africa tender business – 157 vs 101 cr
EM and EU – 846 cr, up 7 pc
APIs – 100 vs 141 cr
R&D expenses @ 354 cr, @ 5.3 pc of sales
Gross Debt @ 547 cr
Cash on Books @ 8996 cr
India – chronic prescription business now @ 61 pc of India sales ( up 100 bps YoY )
Company 24 brands clock sales > 100 cr / yr
Company’s brand – Foracort ( inhaler ) – is ranked no-1 brand in India ( clocking annual sales of 900 cr )
Other mega brands ( sales > 400 cr / yr ) include – URIMAX ( for relief from symptoms of enlarged prostate ) and DYTOR ( diuretic )
Company is also ranked No 1 in trade generics in IPM
Company popular OTC brands in India include – Omnigel, Nicotex, Prolyte, Cofsils, Cipladine
USFDA inspected their facilities at Patalganga and Kurkumbh – and awarded them VAI status. This is good news after successful US FDA inspections at their overseas facilities at China and InnvaGen facility in US
If there was no change in distribution model in the trade generics, India business would have grown by around 9 pc
Company’s India OTC brands are operating at operating 15-16 pc kind of EBITDA margins. Margins should improve as these brands scale up further
Company’s Goa plant was inspected by USFDA in Q1 and was issued with four 483 observations. Its official classification is awaited
Company is working hard on the ramping up of recently acquired Astaberry product portfolio
Revlimid sales were slightly better on a QoQ basis
Resolution of USFDA issue wrt their Goa facility remains a key concern
Seeing an uptick in R&D expenses in next 3 Qtrs of FY 25. For full yr, R&D expenses should settle at 6 pc of sales
Company has lined up launch of 02 peptide products. Same should materialise by Q3/Q4 this yr. In addition, launch of Advair from InvaGen’s manufacturing facility in US should also happen by end of H1 next yr
For the rest of FY, company expects US business’s run rate to be around $ 235-240 million / Qtr
Company is actively looking at both small and big opportunities in the branded generics space in India – for acquisitions – in order to utilise the cash they have on the books. Outside India, they may look at Sterile Injectables or 505(b)(2) product acquisitions in US
Post the launch of 02 peptide products in H2 this yr, company has lined up 03 more peptide product launches for FY 26
Capex guidance / yr @ 1200-1500 cr for next 2-3 yrs
Disc: holding, biased, not SEBI registered, not a buy / sell recommendation
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