Neuland Laboratories crack 13.5% as Q4 results miss Street expectations

Shares of Neuland Laboratories cracked over 13 percent in intra-day deals on Monday after the pharma firm's March quarter results (Q4FY24) missed Street expectations.

The company's net profit fell 20 percent year-on-year (YoY) in Q4FY24 to ₹67.6 crore as against ₹84.5 crore in the same quarter last year. Meanwhile, its total income also declined 6 percent YoY to ₹390.4 crore versus ₹415 crore in the corresponding quarter last year.

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The stock fell as much as 13.5 percent to its day's low of ₹6,150. It is now over 21 percent away from its record high of ₹7,794, hit on April 18, 2024. However, it is still up over 114 percent from its 52-week low of ₹2,518.55, hit on May 12, 2023. The stock has gained 176 percent in the last 1 year and 18 percent in 2024 YTD.

On the operating front, the firm's EBITDA in the quarter under review was down 12 percent to ₹112.2 crore as compared to ₹127.8 crore in Q4FY23. Meanwhile, its EBITDA Margin decreased 202 bps YoY to 28.7 percent in Q4FY24.

The firm also highlighted that its Net Debt declined to ₹(32.6) crore as at Q4FY24 end compared to ₹63.0 crore as at Q4FY23 end and ₹(44.6) crore as at Q3FY24 end.

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Meanwhile, in the overall financial year 2023-24 (FY24), the company's net profit soared 83.7 percent YoY to ₹299.6 crore as against ₹163.1 crore in FY23. Its total income also jumped 30.8 percent YoY to ₹1,571 crore versus ₹1,200 crore in FY23. EBITDA also surged 68.8 percent YoY to ₹474.5 crore in FY24 and EBITDA Margin increased by 680 bps YoY to 30.2 percent.

“We surpassed revenues of ₹1500 crores in FY24 with EBITDA at over 30 percent. This has been driven by high growth in the CMS business and steady growth of the Specialty GDS business, both of which were in line with our plans and expectations. Another key element is the work on optimizing costs & processes which will also make us truly sustainable” said Suchet Davuluri, Vice-Chairman and Chief Executive Officer, Neuland Labs.

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The board of directors of the firm has also recommended payment of final dividend of ₹14/- (140 percent) per equity share on a face value of ₹10 each, for the financial year 2023-24. The dividend will be paid on or after five days from the date of declaration of the final dividend by the shareholders at the 40th Annual General Meeting (AGM).

Neuland Laboratories Limited manufactures and sells active pharmaceutical ingredients (APIs) in India, Europe, the United States, and internationally. The company's APIs are used in various therapeutic areas, including antiasthmatics, cardiovascular, antifungal, anticonvulsants, central nervous system, fluoroquinolones, antipsychotic, antibacterial, and anti-parkinson. It also provides custom manufacturing solutions, as well as peptide synthesis services. Neuland Laboratories Limited was incorporated in 1984 and is headquartered in Hyderabad, India.