Torrent Pharma dips 4% after 3% equity change hands via block deals on BSE

Shares of Torrent Pharmaceuticals dipped 4 per cent to Rs 3,084.80 on the BSE in Wednesday’s intra-day trade after 3 per cent equity of the drug company changed hands via block deals.

 

At 09:15 am; as many as 10.13 million equity shares representing 3 per cent of total equity of Torrent Pharma have changed hands on the BSE, the exchange data shows. The names of the buyers and sellers were not ascertained immediately.

 

As on September 2024, Torrent Investments Private Limited, the promoter of Torrent Pharma, held a 71.25 per cent stake in the comany, the shareholding pattern data shows. 

 

According to media reports, Torrent Investments Private Limited was likely to sell up to 2.9 per cent of Torrent Pharma shares worth up to Rs 3,000 crore through block deals. The shares were likely to be sold at a floor price of Rs 3,022.7 per share.

 

Meanwhile, Torrent Pharma is trading lower for the third straight day, falling 10 per cent during this period. The stock has corrected 14 per cent from its 52-week high level of Rs 3,589.95 touched on October 10, 2024.

 

In the second quarter ended September 2024 (Q2FY25), Torrent Pharma reported 8 per cent year-on-year (Y-o-Y) revenue growth at Rs 2,831 crore, mainly driven by growth in India and stable growth in generics markets of Germany and the US. Brazil growth was lower due to adverse currency movement.

 

Earnings before interest, taxes, depreciation, and amortisation (Ebitda) grew 14 per cent to Rs 939 crore driven by GPM improvement. Ebitda margins expanded by 149 basis points to 32.5 per cent. Profit after tax (PAT) jumped 17 per cent to Rs 453 crore.

 

Branded business performance continue to have strong correlation with the company’s margins (GPM and EBITDAM). India continues to perform well with focus on power brands besides consumer business foray. In Germany, the volatility has reduced due to normalcy in tender allocation.  US situation is set to improve in FY25 on the back of favourable resolution of Dahej and Indrad plants. The management expects margin improvement momentum (50-100bps every year) to persist as besides branded generic markets in India and Brazil, the future looks far better for generic markets of Germany and now US as well, analysts at ICICI Securities said in a note.

 

"Torrent Pharma delivered a miss on earnings due to the reduced offtake of insulin and currency headwinds related to the Brazilian business. The company continues to outperform in the branded markets of India (DF) and Brazil. The US generics business is yet to pick up scale despite regulatory compliance in place," Motilal Oswal Financial Services said in a report.