Lupin registers tepid growth in India revenues, US sales remain subdued

Lupin’s December quarter performance was aided by good growth in the domestic formulations market. The India unit, which contributes 30 per cent to its overall revenues, registered a growth of 11.4 per cent year-on-year. 

North America sales (primarily US), which accounts for about 35 per cent of sales, remained subdued. 

The positive, however, was that sales in the US saw just a per cent decline compared to much higher declines in the past. On a sequential basis, it grew 13.5 per cent and this reflects the fact that the US generics business is turning around. 

The Street will keenly watch out for improvement in growth in the coming quarters. The company’s active pharma ingredients business also supported overall growth, rising at 35.2 per cent year-on-year and 8.5 per cent, sequentially.

While the actual December quarter revenue was much more than estimates, the same was due to higher licensing income. 

The bottom line, on the other hand, was impacted by litigation provisions. Revenues adjusted for licensing income at Rs 4,168 crore was marginally higher than the estimates of Rs 4,104 crore. 

The company had received licensing income of Rs 210.3 crore during Q3FY2019. The operating profits thereby got a boost, and at Rs 796 crore, marked a growth of 11 per cent year-on-year despite some forex losses. Nevertheless, adjusted for the licensing income, the same would have remained muted.

Nilesh Gupta, managing director, Lupin, said, “After a tough first half, we are now starting to see growth in the US. The growth momentum in the US will continue into the next quarter as we are on track with important launches like Levothyroxine (thyroid treatment) and Ranolazine (angina drug). The brand Solosec (gynecology drug) is also progressing well. While a major boost may be expected from Ranolazine, where the company will also get three months exclusivity, Levothyroxine is expected to be ramped up gradually. Lupin also expects a respiratory launch approval by the end of FY20.”


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