Lupin extends gain post Q3 results

The stock hit an intra-day high of Rs 1,852, bouncing back 16% from Rs 1,603, touched on February 5, before the announcements of Q3 results.

Lupin is trading higher by nearly 2% at Rs 1,849 extending its past two day’s gain in an otherwise weak market after the drug maker reported better-than-expected net profit of Rs 601 crore for the third quarter ended December 2015 (Q3FY16).

Revenue grew 7% to Rs 3,357 crore over the previous year quarter on back of better growth in domestic, ROW and Japan business.

Analysts on an average expected profit of Rs 475 crore on revenues of Rs 3,348 crore for the quarter.

Earnings before interest, tax, depreciation and amortization (EBITDA) margin improved by nearly 600 basis points sequentially at 28.1% in Q3FY16 against 22.5% in Q2FY16.

"Sequentially the quarter has improved significantly and this will get much better going forward. The quarter saw a significant pick up in approvals as well as product launches with us clocking in good growth in the US, India and Japan," said Mr. Nilesh Gupta, Managing Director, Lupin.

The next two quarters are likely to be robust (29-30% EBITDA margin) following the full impact of Fortamet price hike and Glumetza FTF launch, according to analyst at HDFC Securities.

Analyst at Ellara Capital expects near-term organic growth to be strong, driven by Glumetza exclusivity.

The stock hit an intra-day high of Rs 1,852 today, recovering 16% from its intra-day low of Rs 1,603, touched February 5, before the announcements of Q3 results.

At 01:07 PM. the S&P BSE Sensex was down 1.2% or 307 points at 23,980. It fell 2.6% or 637 points in past two trading sessions.