Ranbaxy jumps 6% on strong Q4 margins; investors discount net loss of Rs 159 crore

MUMBAI: Shares of Ranbaxy Laboratories Ltd rallied as much as 7.8 per cent in trade on Wednesday, as sentiment turned bullish following strong margins for the quarter ended December.

Shares of Ranbaxy Laboratories finally closed 5.7 per cent higher at Rs 340.05. It hit a low of Rs 317.60 and a high of Rs 347 in trade today.

Adding to the positive sentiment was the management statement, which said the company is taking all the necessary steps to resolve the USFDA issue.

Investors discounted the net loss of Rs 159 crore as against a net profit of Rs 492 crore in the corresponding quarter last fiscal year.

According to an analyst tracking the sector, the company has managed to maintain margins and that is driving the stock higher. Ranbaxy Laboratories reported Q4 EBITDA margins at 9.9 per cent versus 2.9 per cent year on year (YoY).

Its sales for the quarter were in line at Rs 2,859 crore, up 7 per cent, from Rs 2,670 crore, YoY.

The company has made provisioning of Rs 257 crore for Toansa unit. It reported Rs 104 crore MTM gain on derivatives and forex gain of Rs 10 crore.