Granules India surges 8%, hits new high on strong June quarter results

In Q1FY21, Granules India's Ebitda margin improved 503 basis points to 25 per cent

Shares of Granules India jumped 8 per cent to Rs 265, also its new high, on the BSE on Friday after the company reported a strong set of numbers with Ebitda (earnings before interest, taxes, depreciation and amortization) margin improvement of 503 basis points to 25 per cent in June quarter (Q1FY21).

The company’s revenue from operations in Q1FY21 grew by 23.6 per cent year on year (YoY) to Rs 735.6 crore. Ebitda for the quarter grew at 54.8 per cent at Rs 183.60 crore. Profit after tax rose 33.9 per cent YoY at Rs 111.4 crore.

The company said the major growth contribution was due to a significant increase in production to cater to new product launches and increase in market share of existing products across the three verticals. The company launched Colchicine tablets and Butalbital APAP caffeine tablets through Granules Pharmaceutical Inc (GPI) during the quarter.

Emkay Global Financial Services had expected Granules India to report Ebitda margin of 23.2 per cent for the quarter. Net sales and net profit were expected at Rs 673 crore and Rs 91.2 crore, respectively.

“Strong revenue growth will be led by resumption of Paracetamol exports and deferred sales from Q4. Margins should improve quarter on quarter due to higher US$ realizations, higher contribution from formulations and USD 3 million one-off impairment charge in Q4 base,” the brokerage firm had said in pharma sector update.

At 12:50 pm, the stock was trading 6 per cent higher at Rs 261 on the BSE, as compared to 0.56 per cent rise in the S&P BSE Sensex. The trading volumes on the counter jumped 3-fold with a combined 16.7 million equity shares changing hands on the NSE and BSE so far.