Shares of Neuland Laboratories hit a fresh record high of Rs 1,965, up 16 per cent on the BSE, in the intra-day trade on Tuesday on the back of heavy volumes. In the past seven trading days, the stock of the pharmaceuticals company has soared 53 per cent after the company's net profit more-than-doubled at Rs 26.7 crore for the quarter ended December 2020 (Q3FY21) on the back of strong operational performance. It had reported a profit of Rs 11 crore in the year-ago quarter.
In Q3FY21, the company's Ebitda (earnings before interest, taxes, depreciation, and amortisation) jumped 60.6 per cent YoY at Rs 46.7 crore, while margins expanded 480 basis points (bps) YoY to 19.0 per cent from 14.2 per cent. Total income grew 20 per cent YoY at Rs 245.60 crore.
The strong performance during the quarter was driven by growth across the generic drug substances (GDS) and custom manufacturing solutions (CMS) verticals. The change in business mix with increasing amount of margins coming from CMS business and certain Specialty products and cost optimization measures helped improve profitability. The management remains confident of the company’s long-term growth aspirations as well as margin resilience.
"The driver of this quarter’s CMS uptick has been the strong performance from the scale-up projects which have contributed to the revenues. Unit 3 has started commercial production and the company is currently shipping out 2 API’s from this facility. The management expects Unit 3 to be a major driver of growth going forward," the management said in a statement.
At 02:48 pm, Neuland Labs was trading 11 per cent higher at Rs 1,888 on the BSE, as against a 0.34 per cent gain in the S&P BSE Sensex. A combined around 600,000 equity shares changed hands on the counter on the NSE and BSE till the time of writing of this report.