Lupin Q2 up 39%; sees FDA resolution by 2009-end

Lupin Q2 up 39%; sees FDA resolution by 2009-end

Mumbai: Drugmaker Lupin Ltd forecast a strong year ahead after it posted a 39% increase in second-quarter net profit on double-digit sales growth in its US and Europe operations.

One of the fastest growing Indian generic, or off-patent, drugmakers in the US and Europe, Lupin’s sales in these markets grew at 27% in the July-September quarter. Local sales increased 18.5%, the company said in a statement.

Its overall net profit increased to Rs160.3 crore from Rs115.6 crore a year earlier, as sales rose nearly 23% to Rs1,115 crore.

Sarabjit Nangra, a sector analyst with Angel Broking Ltd, said a 25% growth in sales is expected for a company with a rich generic portfolio and new markets in its focus.

“So the growth that Lupin has achieved during the quarter is quite sustainable, though the operational margin hasn’t shown a corresponding growth this time," Nangra said.

Nilesh Gupta, group president and executive director, Lupin, said the firm’s operational margins reflected its additional spending on infrastructure expansion and manpower. “But the new businesses that we have acquired recently and the growth in the existing markets will remain strong in the year," he said.

Lupin has been adding people in research and development and it spent about Rs150 crore in a facility coming up in Indore, Gupta told Mint.

Lupin continues to maintain its growth momentum in the US and European markets, which account for 32% of its net sales. The company filed seven applications in the US for its generic drugs, known as abbreviated new drug applications, or ANDA, during the quarter, taking the total number of such filings by it to 98, Lupin said in a statement.

In the second quarter, Lupin had also licensed the US rights of its bio-adhesive technology for an antibiotic drug, rifaximin, to US-based Salix Pharmaceuticals Ltd.

Lupin shares dropped 1.09% on Monday to close at Rs1,239.00 on the Bombay Stock Exchange, while the benchmark Sensex lost 70.31 points, or 0.42%, to end at 16,740.50.