Lupin soars after turnaround performance in Q2; India sales up 2.6% YoY

Lupin jumped 7.67% to Rs 747.30 after the company reported a consolidated net profit of Rs 129.7 crore in Q2 FY23 as against a net loss of Rs 2,098 crore recorded in Q2 FY22.

Sales rose by 2.2% YoY to Rs 4,091.2 crore during the quarter. While Total Formulations revenue rose by 2.8% to Rs 3,841.3 crore, API revenue declined by 6.7% to Rs 249.9 crore in Q2 FY23.

In the Formulations business, the improvement in sales was led by ROW segment (up 50% YoY), followed by Growth Markets (LATAM and APAC) segment (up 27.5% YoY), Europe, Middle-East and Africa (EMEA) segment (up 10.3% YoY) and India segment (up 2.6% YoY). The sales in the North America region, however, declined by 7% YoY.

The India and the North America segments together accounted for 72% of the company's total product sales.

Material costs aggregated to Rs 1,712.8 crore (up 5.3% YoY) in the second quarter. Manufacturing & other expenses increased by 7.4% YoY to Rs 1,226.8 crore during the period under review.

EBITDA declined by 25.5% to Rs 468 crore in Q2 FY23 from Rs 628.5 crore in Q2 FY22. EBITDA margin was 11.4% in Q2 FY23 as against 15.7% in Q2 FY22.

Finance cost jumped 59.6% to Rs 54.9 crore in Q2 FY23 over Q2 FY22.

The company recorded a pre-tax profit of Rs 209.6 crore in the second quarter of FY23. It had posted a pre-tax loss of Rs 2,204.8 crore in the corresponding period last fiscal.

Investment in R&D was Rs 337.6 crore (8.3% of sales) for Q2 FY23 as compared to Rs 330 crore (8.2% of sales) for Q2 FY22.

Operating working capital was Rs 6,354 crore as on 30 September 2022. Capital expenditure for the quarter was Rs 154 crore.

As on 30 September 2022, net debt stood at Rs 2,931.6 crore and net debt-equity for the company was 0.25.

Nilesh Gupta, managing director, Lupin Limited said, We have performed in line with our expectations during the quarter, and are on the path of steady growth in sales and profitability.

Our sales growth sequentially was robust as our U.S. business bounced back. Our India business delivered continued growth in line with the market, excluding the impact of loss of exclusivity and certain sales in the diabetes and cardiovascular therapy area.

All other geographies performed well, and we continue to see the benefit of our optimization measures implemented.

Lupin is an innovation-led transnational pharmaceutical company. The company develops and commercializes a wide range of branded and generic formulations, biotechnology products, and APIs in over 100 markets in the U.S., India, South Africa, and across the Asia Pacific (APAC), Latin America (LATAM), Europe, and Middle East regions.

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