Earnings Outlook
Core markets to aid Gland Pharma's Apr-Jun earnings
This story was originally published at 18:02 IST on 22 July 2024
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By Narayana Krishna
HYDERABAD – Robust growth in its core markets is likely to help Gland Pharma Ltd report healthy growth in Apr-Jun earnings on a year-on-year basis, analysts said. China's Fosun Pharma Group-controlled company is likely to report a consolidated net profit of 2.2 bln rupees, up 14% year-on-year, while revenue is seen up 27% on year at 15.4 bln rupees, according to an average of estimates of seven brokerages. Sequentially, the company's net profit is seen up 15%, while revenue is seen flat.
Among the brokerage estimates, Nirmal Bang expects the lowest net profit and revenue at 1.98 bln rupees and 14.52 bln rupees, respectively, for the quarter. Meanwhile, InCred Research has the highest net profit expectation of 2.46 bln rupees and Nomura Equity Research sees the revenue at 15.96 bln rupees. The company is scheduled to announce its Apr-Jun earnings on Aug 6.
Most analysts are positive on Gland Pharma's core business, though they see stress in its acquired European company Cenexi's earnings.
Nomura said Gland Pharma is expected to report robust growth in the US, Europe, Australia, and Canada, which it classifies as its core markets, with a 51% year-on-year rise in sales in this segment. India sales are likely to be flat on year, while the rest of the world segment growth is seen at 5%.
The recovery in the US, which was seen in Jan-Mar, is likely to sustain for the Apr-Jun quarter too, with market share gains for some of its key products, Nomura said. YES Securities expects a pickup in the US business, led by the anti-blood clot drug Enoxaparin and the first generic launch of the breast cancer drug Eribulin.
Analysts are positive on Gland Pharma's June quarter earnings before interest, tax, depreciation, and amortisation, or EBITDA margins, which are likely to improve, led by lower raw material costs and an improved sales mix in core markets. Analysts' estimates for the company's EBITDA margin are seen in the range of 23.6-24.8%. The average of estimates of seven brokerages for Gland Pharma's Apr-Jun EBITDA is 3.7 bln rupees.
Analysts are looking for an update on new approvals and the product launch pipeline in the core markets, besides clarity on the status of Gland Pharma's China operations and the timeline for turning around Cenexi's operations.
Following are the Apr-Jun earnings estimates for Gland Pharma Ltd based on reports compiled by Informist from seven brokerage houses:
Broker name | Net Sales | Net Profit | EBITDA (in mln rupees) |
---(In mln rupees)--- | |||
Axis Securities Ltd | 14,950.00 | 2,320.00 | 3,650.00 |
InCred Research Services Pvt Ltd | 15,945.00 | 2,459.00 | 3,948.00 |
Kotak Institutional Equities | 15,409.00 | 2,392.00 | 3,765.00 |
Motilal Oswal Financial Services Ltd | 15,138.00 | 2,120.00 | 3,573.00 |
Nirmal Bang Equities Pvt Ltd | 14,523.00 | 1,975.00 | 3,159.00 |
Nomura Equity Research | 15,964.00 | 2,111.00 | 3,875.00 |
YES Securities (India) Ltd | 15,918.00 | 2,149.00 | 3,933.00 |
Average | 15,406.00 | 2,218.00 | 3,700.00 |
Today, Gland Pharma's shares ended at 1,994.75 rupees on the National Stock Exchange, up 0.2% from its previous close. End
Edited by Manisha Baxla
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