Eris Life soars 13% on strong Q3 revenue; Co reduces debt ahead of guidance

The board of directors of Eris Lifesciences is scheduled to meet on Friday, February 07, 2025, to consider the declaration of interim dividend for the financial year 2024-25

Eris Lifesciences share price moved higher by 13 per cent to Rs 1,386 on the BSE in Wednesday's intraday trade, in an otherwise subdued market, after the company reported healthy December quarter (Q3) results.  

 

Eris Life reported a strong revenue growth of 49.6 per cent year-on-year (Y-o-Y) in Q3FY25, aided by integration of Swiss Parenteral and synergies from Biocon's portfolio. The pharmaceutical company guided for net debt of Rs 2,100 crore/1,750 crore by FY25/H1FY26 as against Rs 3,000 crore as of FY24.

 

Meanwhile, the board of directors of Eris is scheduled to meet on Friday, February 07, 2025, to consider the declaration of interim dividend for the financial year 2024-25. 

 

 

"In the event of the declaration of interim dividend as aforesaid, the proposed record date for the purpose of determining the members eligible for receiving the said interim dividend shall be Monday, February 10, 2025," Eris said in an exchange filing.

 

At 11:46 AM, Eris Life share price was quoting 11 per cent higher at Rs 1,363.35, as compared to 0.22 per cent decline in the BSE Sensex. The stock had hit a record high of Rs 1,593 on December 11, 2024. 

 

In Q3FY25, Eris reported 42.6 per cent Y-o-Y growth in earnings before interest, tax, depreciation and amortisation (Ebitda) at Rs 250 crore. Margins, however, contracted to 34.4 per cent from 36.1 per cent.

 

The Y-o-Y impact on gross margins was largely on account of change in product and business mix due to integration of new businesses. Depreciation and finance charges came in higher due to consolidation of new businesses. Resultant profit after tax came in at Rs 87 crore, down 14.3 per cent Y-o-Y.

 

Eris Life has opted for an inorganic route to diversify and scale up its existing portfolio. This has been implemented without diluting margins. Analysts at PL Capital, thus, expect margins to sustain at over 35 per cent as revenue scales up from recent acquisitions, which are currently operating at sub-optimal profitability. 

 

"The company has multiple growth levers such as broad-based offerings in the derma segment, opportunities in the cardiometabolic market with patent expirations and benefits of operating leverage, as revenue scales up from these acquisitions," the brokerage firm said in its result update report. It maintained its 'buy' rating on Eris Life stock with a revised target price of Rs 1,450 per share.

 

Eris Lifesciences is engaged in the manufacture and marketing of pharmaceutical products. The company holds a dominant position in key specialty areas such as Diabetologists, Cardiologists, Neurologists, Gynecologists, Dermatologists and Consulting Physicians. The company derives 40 per cent of Branded Formulations revenue from seven emerging specialties of Dermatology, Insulins, Women’s Health, CNS, Oncology, Critical Care and Nephrology, giving us significant headroom for disruptive growth in these segments.

 

"The acquisition of Swiss Parenterals and Biocon's domestic branded formulations business will provide a strong launch platform to make deeper inroads in the Indian Injectables market. A number of major molecules will lose exclusivity in the cardio metabolic segment in the next 3-5 years. On the back of its established position in this market, Eris is well positioned to leverage these opportunities as has been demonstrated over the last 3 years with Top-5 market positions in several molecules," the company said in its Annual Report.