Shares of Granules India surged 18 per cent to Rs 119.70 on the BSE on Tuesday after the company's net profit jumped 59 per cent year on year (YoY) to Rs 96 crore in September quarter (Q2FY20) on the back of strong operational performance. The pharmaceutical company had logged profit of Rs 60 crore in the year ago quarter. The stock was trading close to its 52-week high of Rs 120 touched on April 22, 2019.
While operational income grew 20 per cent at Rs 700 crore as against Rs 581 crore in the year ago quarter, Ebitda (earnings before interest, tax, depreciation and amortization) margin expanded 322 bps at 20.5 per cent from 17.3 per cent. The board also declared second interim dividend of 25 paise per share of face value of Re 1 each, representing 25 per cent of paid-up capital, for the financial year 2019-20.
The management attributed the result to "operational excellence and a vigilant watch over its margins via optimal product mix, capacity utilization and minimization of their expenses".
"The company’s unwavering focus on the regulated market at a contribution of 73 per cent (North America and Europe) and a shift towards Pharmaceutical, Formulation Intermediates (PFls) and Finished Dosages (FDs) at 69 per cent of the total revenue has enabled the company to achieve this growth during the quarter," it added.
Besides, the board approved divestment of the company’s stake in Granules Omnichem, a joint venture company located in India, and in Granules Biocause Pharmaceutical, a joint venture company located in China. Both the actions will allow the company to "focus on their core strengths while allowing them to enhance free cash flow and reduce net debt".
Meanwhile, in a regulatory filing with the stock exchange on Monday, the Hyderabad-headquartered company said US Food and Drug Administration (USFDA) had approved its Abbreviated New Drug Application (ANDA) for Fexofenadine Hydrochloride Tablets USP, 60 mg and 180 mg (OTC). It is bioequivalent to the reference listed drug product (RLD) – Allegra Allergy tablets, 60 mg and 180 mg, of Sanofi-Aventis U.S. LLC, the company said.