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Cipla Ltd on Wednesday reported a net profit of 801 crore for the quarter ending 31 December, up 9.9% year-on-year. Excluding one-time tax charge on account of DTA (deferred tax asset) reversal, the adjusted net profit at 876 crore grew 20.2 % y-o-y and 11.0% sequentially. But it fell short of Bloomberg Consensus analysts’ estimates of 904.6 crore.

The company saw record contributions from the US market and in spite of a decent India performance, some weakness in the Africa business pulled down the overall show.

The North America sales at 1,600 crore grew 42.3% y-o-y and 11.75% sequentially. In dollar terms, the company reported highest ever quarterly revenue of $195 million and 30% y-o-y growth. Strong traction in the differentiated portfolio including market share expansion in key respiratory and peptide injectable products helped.

The India sales that contribute more than 40% to the overall revenues also saw decent growth trajectory on a high base of last year.

The previous year had seen significant contributions of covid treatment and management product sales leading to a higher base. The India revenues at 2,563 crore though were up just 1.8% year-on-year, the company said that ex-covid revenue growth came at 11% y-o-y.

“Our Q3FY23 performance reflects sustained momentum in core One-India and US businesses driving our overall revenue growth of 6% reported and 11% on an ex-covid basis. Our One India franchise delivered strong performance across therapies and segments with double digit market beating growth in prescription on a covid adjusted base", said Umang Vohra, MD and Global CEO, Cipla Ltd.

The highest ever quarterly revenue for the North America region of $195 million was driven by the contribution of differentiated products and market share expansion in flagship respiratory and peptide franchises, as per Vohra.

“Our reported operating profitability of 24.2% reflects our focused efforts on navigating external headwinds and continued", added Vohra.

The company’s reported earnings before interest tax depreciation and amortization (Ebitda) at 1,408 Crore grew 13.2% y-o-y and 8.1% sequentially. The margins at 24.2 % expanded 153bps y-o-y and 11.7% sequentially.

For the quarter ending December, Cipla Ltd.’s revenue growth came at 6% YoY to 5810 crore on a reported basis. The Ex covid revenue growth however came at strong 11% YoY ex-covid growth.

The same could have been more but for SAGA (South Africa, Sub-Saharan and Cipla Global Access business) showing weakness impacted by product adjustments. The SAGA revenues of 680 core declined 23.8% year-on-year and 21.6% sequentially. South Africa sales at 550 Crore too were down, 11.8% y-o-y and 8% sequentially. The company said that the supply challenges are being addressed.

Analysts at ICICI Securities said that Cipla numbers missed our expectations on the revenue front but were upbeat on the margin front. The India business continued its strong performance on the back of strong growth across all therapies but missed our expectations.

Cipla Stock prices ended the day 2.18% lower at 1039 on the NSE on Wednesday.

ABOUT THE AUTHOR

Ujjval Jauhari

Ujjval Jauhari is a deputy editor at Mint, with over a decade of experience in newspapers and digital news platforms. He is skilled in storytelling, reporting, analysing and writing about stocks, investment ideas, markets, corporates and more. He is based in New Delhi.
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