Lupin Q4 results misses Street estimates; stock declines

MUMBAI: Shares of pharmaceutical major Lupin took a sharp fall to close the day at Rs 1,690.60, down 3.35%, on the BSE, after disappointing the Street on both top line and bottom line in its fourth quarter earnings.

The company reported a consolidated net profit of Rs 547 crore in , down 1.1 per cent, as compared to a net profit of Rs 553 crore in the corresponding quarter last fiscal. It missed ET Now poll estimate of Rs 614 crore.

Net sales in the Jan-March quarter stood at Rs 3,054 crore, up 0.1 per cent, from Rs 3,051 crore in the same quarter last fiscal. It is lower than ET Now poll estimate of Rs 3,330 crore.

The margins declined to 25.8 per cent as against 28.7 per cent, year-on-year.

“Though the Street expected it to be moderate, the numbers are way below our expectations. Lower sales and higher employee expenditure has led to margins contraction,” said Sarabjit Kour Nangra, VP - Research, Angel Broking.

According to her, the stock is fairly valued at current levels and a significant downside from current levels is not expected.

Nilesh Gupta, Managing Director, Lupin, said higher price erosion in the US as well as a slowdown in product approvals impacted growth in the quarter, but overall the Company has done well to improve gross margins and enhance profitability for the year.

“We continue to ramp up investment in Research in segments like Inhalation, complex Injectables and Biosimilars. Our execution strength, pipeline evolution and planned M&A will drive our future as a global generic and specialty pharmaceutical company,” Gupta said.