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Lupin Q4 profit soars 47% on US biz despite 65% rise in R&D cost

Chillicious Team

Lupin’s fourth quarter earnings surpassed analysts’ expectations on Thursday with consolidated profit soaring 47.5 percent to Rs 807 crore compared to year-ago period, driven by strong international as well as domestic business despite sharp spike in tax cost.

Revenue in Q4 increased 35.9 percent to Rs 4,181.2 crore with international business rising 41.1 percent (to Rs 3,305.7 crore) and India growing 19 percent (to Rs 875.5 crore) compared to corresponding period of last fiscal, the pharma major said in its filing.

“Record approvals and significant launches have enabled us to deliver the company’s best results yet and we are back of growth path. We continue to ramp up investments in research,” Nilesh Gupta, MD said.

US formulation business for the quarter increased by 58.7 percent, led by exclusivity sales from Glumetza generic (diabetes drug).

India grew by 14.7 percent and Japan sales rose 17 percent compared to year-ago period. Rest of World markets clocked in sales growth of 38.3 percent in Q4 while South African subsidiary, Pharma Dynamics recorded 7.1 percent degrowth in sales.

According to analysts polled by CNBC-TV18, profit was estimated at Rs 725.7 crore on revenue of Rs 3,816.3 crore for the quarter. Operating profit growth was expected at 40 percent and margin expansion at 340 basis points YoY.

The company said it has filed 36 ANDAs (abbreviated new drug application) and received 39 approvals during the year while during the quarter, it filed 17 ANDAs and received 6 approvals from the USFDA.

Operating profit (earnings before interest, tax, depreciation and amortisation) shot up 73.2 percent year-on-year to Rs 1,367.4 crore and margin expanded by 710 basis points to 32.7 percent in March quarter despite 65 percent increase in R&D expenses (to Rs 511.3 crore).

Tax expenses increased 203.4 percent to Rs 413.2 crore and finance cost rose 9-fold to Rs 22.9 crore while other income was up 47.7 percent at Rs 25.4 crore compared to year-ago period.

Lupin said it has recommended dividend of Rs 7.50 per share for the year ended March 2016.

For the full year (FY16), profit grew by 5.5 percent to Rs 2,270.7 crore and revenue by 11.3 percent to Rs 14,208.5 crore compared to preceding year.

At 14:32 hours IST, the scrip of Lupin was quoting at Rs 1,656.30, up Rs 23.85, or 1.46 percent on Bombay Stock Exchange.