Alembic Pharmaceuticals Q2 net profit rises 62% to Rs 2.07 billion

Vadodara-based pharma major Alembic Pharmaceuticals posted a 69 per cent year-on-year (YoY) jump in net profit for the second quarter of this fiscal year to Rs 2.07 billion, riding on a one-time supply opportunity of valsartan products to the US. 

The revenues grew 43 per cent to Rs 11.27 billion. 

The company's international revenues posted robust growth of 124 per cent for the quarter under review to Rs 5.87 billion.

Pranav Amin, managing director at Alembic Pharmaceuticals, said: "A one-time supply opportunity arising due to a product shortage in the US market has resulted in higher profits." If the valsartan sales were taken out, then the US revenue growth would be upwards of 20 per cent, he clarified. "Growth in sales in the rest of the world (RoW) has been above 100 per cent," Amin said. 

Alembic plans to launch 10-15 products in the US this year. It launched one product during the quarter and filed eight abbreviated new drug approvals (ANDAs). The research and development (R&D) cost for the quarter came in at Rs 1.45 billion or around 13 per cent of sales. Alembic has one of the highest R&D spends amongst peers. 

Alembic's dermatology joint venture Aleor, which was recently inspected by the US Food and Drug Administration (USFDA), was approved by the regulator without any observations. 

The stock that was up in the morning as the news of USFDA approval came in ended the day's trade at Rs 582 a piece, down 4.27 per cent.

The India formulations business was flat at Rs 3.85 billion for the quarter, and the company claimed this was not comparable due to GST implementation last year. The company, however, expects 14-16 per cent growth in the domestic business. 

For the first half of the year, the company posted a 15 per cent rise in its India formulations business to Rs 7.16 billion, while the international revenues grew 73 per cent to Rs 9.39 billion. Overall revenues for H1FY19 grew 38 per cent to Rs 19.9 billion. H1FY19 profit after tax grew 63 per cent to Rs 3.05 billion.