Jubilant Life hits 52-week high on heavy volumes, soars 46% in 11 days

The stock hit a 52-week high of Rs 646, up 8% today, surpassing its previous high of Rs 639, touched on January 23, 2020, on the BSE.

Continuing their northward movement, shares of Jubilant Life Sciences, hit a 52-week high of Rs 646, up 8 per cent on the BSE on Monday in the intra-day trade on the back of heavy volumes.

The stock of the pharmaceutical company surpassed its previous high of Rs 639, touched on January 23, 2020. At 12:06 pm, it was trading 7 per cent higher at Rs 636, as compared to a 2.3 per cent decline in the S&P BSE Sensex. The trading volumes on the counter jumped an over 20-fold with a combined 4.13 million equity shares, representing a 2.59 per cent of the total equity, changing hands on the BSE and NSE so far.

The company recently signed a licensing agreement with the US-based Gilead Sciences to register, manufacture and sell Gilead’s investigational drug, remdesivir, a potential therapy for Covid-19, in 127 countries including India, and is working towards launching the drug in July 2020.

Meanwhile, thus far in June, (11 trading days), the stock has zoomed 46 per cent after it reported a 92 per cent year-on-year (YoY) jump in the normalised profit after tax at Rs 260 crore in Q4FY20. Revenue from operations remained flat at Rs 2,391 crore, as compared to Rs 2,386 crore in the previous year quarter.

The company’s adjusted EBITDA (earnings before interest, taxes, depreciation, and amortisation) after one-off expenses stood at Rs 568 crore, and was up 46 per cent YoY from Rs 388 crore in the year-ago quarter. Ebitda margin improved to 23.7 per cent from 16.3 per cent in Q4FY19.

The management said despite the Covid-19 led challenges, the company continues to experience strong demand across most of its businesses.

“While there is expected to be some decline in revenues and profitability in Q1FY2021 due to Covid related lockdowns, we expect to get back to normal levels once the Covid-19 impact has receded. Based on the assessment to date, the impacts of these disruptions are not expected to have a material financial impact on the full-year financial results,” it said.

“The key positive for the quarter was the stabilisation in the life science ingredients (LSI) business with the segment revenue growing by 3 per cent sequentially aided by growth in export markets and stabilisation in the domestic LSI business (revenue flat over the last 4 quarters),” analysts at JM Financial said in result update.

Jubilant is working towards initiating the production of Remdesivir, subject to regulatory approvals, in July’20. The separate listing of Jubilant’s two business segments is expected to unlock value even as an NCLT approval and the demerger could now be delayed till November 2020, it said.