Gland Pharma shares fall over 4% after weak Q3 result, Jefferies target price cut

Gland Pharma shares fell by 4.5% to their intraday low of Rs 1,452 on the BSE after the company reported a 7% year-on-year (YoY) increase in net profit to Rs 205 crore for Q3FY25, compared to Rs 192 crore in the same period last year.

Revenue from operations declined 10% YoY to Rs 1,384 crore. EBITDA rose 1% YoY to Rs 360 crore, with margins expanding 300 basis points to 26%. R&D expenses stood at Rs 43.7 crore, accounting for 4.3% of revenue.

During Q3FY25, Gland Pharma filed four abbreviated new drug applications (ANDAs) and received eight ANDA approvals in the US. The company incurred Rs 138 crore in capex during the quarter.


The company received establishment inspection reports (EIRs) indicating closure of inspection from the USFDA for its Dundigal and Pashamylaram facilities in Hyderabad.

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The company on complex injectables said it has completed nine filings in a targeted portfolio of 19 products.

"Six of these complex products have already been launched, with three more expected to secure approval in due course. These products target an IQVIA market opportunity of US$7.1 billion, reflecting the significant potential of this segment to drive future growth," the company said.

Following the Q3 results, Jefferies maintained an 'Underperform' rating, lowering the target price to Rs 1,350 from Rs 1,630.

The brokerage cited weak revenue growth in the base business despite multi-quarter high margins. Management expects a recovery in Q4, but Cenexi's breakeven timeline has been delayed by a year. Jefferies also highlighted execution challenges and the lack of near-term catalysts, lowering its FY25-27E EPS estimates by 1-4%.

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Additionally, 15 complex formulations which are under co-development with MAIA Pharmaceuticals Inc, a specialty injectable development company, have shown promising progress. These include seven 505(b)(2) and eight ANDAs at different stages of development. The company said it expects commercialization to begin from FY27.

The biologics segment of the company said its partnership with one of the leading pharmaceutical companies leverages the company's state-of-the-art biologics manufacturing facility at Genome Valley in Hyderabad and opens exciting new opportunities in the rapidly growing biologics CDMO segment.

"This collaboration is expected to generate incremental revenue starting next financial year," the company said.

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