GST transition drags Alembic Pharma net by 36% to Rs 65 cr in June quarter

The drop is primarily on account of a transitional provisioning for GST

Vadodara-based Alembic Pharmaceuticals posted a 36 per cent drop in net profits to Rs 65 crore in the June quarter of financial year (FY) 2017-18, as against Rs 102 crore in the corresponding period of the previous financial year. The fall in profits happened because of transition to the goods and services tax (GST) regime.

Its revenues dropped by 12 per cent year-on-year (y-o-y). Alembic posted net sales for the quarter at Rs 648 crore against Rs 737 crore in the year-ago period.

Managing Director Pranav Amin said, "The performance in the quarter was weak primarily due to the transitional provision of GST on the India branded business."

The international formulation business revenue was Rs 282 crore as against Rs 309 crore in the last FY's corresponding period. Of this, the United States (US) formulation business revenue was Rs 211 crores for the quarter, down 5 per cent y-o-y. Non-US business was down 17 per cent y-o-y.

Research & development (R&D) spend for the quarter under review stood at Rs 94 Crores, which approximately 14 per cent of sales.

India formulations business for the quarter stood at Rs 236 crore as against Rs 299 crore last year. Of this, the speciality business is down 23 per cent and the acute therapies is down 22 per cent.