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Informist, Monday, May 11, 2026

NEW DELHI – Cipla Ltd. is expected to report a sharp decline in net profit for the March quarter, mainly due to weak sales in the US, hurt by higher competition in generic cancer drug Revlimid and supply disruption in Lanreotide after production at its partner facility was halted due to regulatory issues. 

Mumbai-Headquartered Cipla's consolidated net profit is expected at INR 7.27 billion for the March quarter, as per estimates from 10 brokerages. This is nearly 41% down on year and about 24% lower sequentially. The highest estimate for the company's net profit is INR 8.47 billion by Emkay Global Financial Services Ltd. and the lowest estimate is INR 5.30 billion by Systematix Shares and Stocks (India) Ltd.

The pharma company's revenue for the March quarter is expected to be INR 66.82 billion, marginally down on year and about 6% lower on quarter, according to the estimates. The highest estimate for the company's revenue is INR 70 billion by Elara Securities (India) Pvt. Ltd., while the lowest estimate is INR 62.58 billion by Systematix Shares and Stocks.  

Cipla, one of India's leading pharmaceutical companies with a strong presence in respiratory therapies and a significant share of revenue from the US market, is likely to see a sharp decline in US business, with revenue from the geography estimated to fall 20–30% on year, according to brokerages. 

The decline in US sales is primarily due to increased competition in generic Revlimid after the end of its limited exclusivity in January, which led to pricing pressure. Additionally, supply disruption in Lanreotide, following regulatory issues at partner Pharmathen International S.A., Greece facility, led to a product recall and halted production, further weighing on sales.

"Cipla's US generics revenue will likely see a sharp decline YoY (year-on-year) and QoQ (quarter-on-quarter), due to softening gRevlimid demand and supply disruption in lanreotide," said Systematix Shares and Stocks India in its report.

In contrast, Cipla's India business is expected to deliver strong growth of 11–12% on year, led by momentum in respiratory and anti-diabetic segments, partly supported by new launches such as tirzepatide Yurpeak under its partnership with Eli Lilly and Co.

Cipla's revenue in its Africa business is expected to grow 5% on year for the March quarter, led by 12% on-year growth in South Africa and favourable currency movement, as depreciation of the Indian rupee against the South African rand boosted the reported revenue, according to Kotak Securities Ltd. For Europe, brokerages expect around 7% on-year growth in revenue.

The company's earnings before interest, tax, depreciation, and amortisation are estimated at INR 10.44 billion for the March quarter, down over 32% on year. The highest estimate for the company's EBITDA is INR 12.02 billion by Emkay Global Financial Services, while the lowest is INR 8.19 billion by Systematix Shares and Stocks India.

EBITDA is expected to decline due to margin pressure from an unfavourable product mix and lower contribution from high-margin US products, said Prabhudas Lilladher Pvt. Ltd. "Increased competition, leading to pricing pressure on products, including generic Revlimid, may weigh on EBITDA performance," said Motilal Oswal Financial Services Ltd.

Key things to watch in the management's commentary would include progress on respiratory launches and updates on Lanreotide supply.

For the financial year 2025-26 (Apr-Mar), the company is expected to report consolidated net profit in the range of INR 42.74 billion-INR 43.46 billion. The highest estimate is from Motilal Oswal Financial Services and the lowest from Prabhudas Lilladher. The company's revenue for FY26 is expected to be in the range of INR 283.30 billion–INR 284.12 billion. The highest estimate is from Prabhudas Lilladher and the lowest from Motilal Oswal Financial Services.

Cipla is scheduled to report its March quarter results on Wednesday. At 0917 IST, shares of the company traded at INR 1,337 on the National Stock Exchange, down over 10.2%. The shares are up nearly 2% since the company reported its December quarterly results. 

Out of the 12 brokerage reports on the company available with Informist, eight have a 'buy' recommendation on the stock with an average target price of INR 1,560. This is nearly 17% higher than the current market price. One brokerage has a 'hold' rating on the stock with an average target price of INR 1,310. Three brokerages have a 'sell' rating on the stock with an average target price of INR 1,351.

The following are the March quarter earnings estimates for Cipla from 10 brokerages in descending order of the estimate of net profit in INR billion:

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Edited by Akul Nishant Akhoury

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