Views on Lupin Ltd 1QFY2018 Results: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research - Pharma, Angel Broking):

"Lupin for 1QFY2018 posted bad set of numbers. Sales came in at INR 3,806cr V/s INR 4,316cr expected and V/s INR 4,3418cr in 4QFY2017, a YoY de-growth of 12.3%. The dip was mainly on back of the formulation sales (INR 3,528cr) which declined by 12.8%, mainly on back of a 26.8% dip in the USA (INR 1,602cr; accounting for 42% of global sales). Lupin's India formulation sales grew by 6.1% to INR 932.4cr during 1QFY2018 as compared to 4QFY2017 and decreased by 1.8% compared to 1QFY2017; accounting for 25% of Lupin's global sales. Lupin's APAC sales were at INR 599cr during 1QFY2018 compared to sales of INR 6,12cr during 4QFY2017 and INR 5,42cr during 1QFY2017; accounting for 16% of Lupin's global sales.

On operating front, the EBITDA margins came in at 18.5% V/s 22.9% expected V/s 27.4% in 1QFY2017, mainly on back of lower than expected sales during the quarter and dip in the gross margins. Gross margins came in at 67.6% V/s 70.5% in 1QFY2017; which along with the lower rise in expenses lead the OPM to come in at 18.5% V/s 27.4% in the last corresponding period. Employee, R&D and other expenses have risen by 1.7%, 0.1% and (0.5)% respectively. R&D expenses were 13.1% of sales in 1QFY2018 V/s 11.6% of sales in 1QFY2017. Thus, the PAT came in at INR 358cr V/s INR 607cr expected V/s INR 882cr in 1QFY2017, a YoY de-growth of 59.4%. Tax rate during the quarter was 27.7% of PBT V/s 23.6% of PBT in 1QFY2017. We maintain our BUY rating on the stock."

Shares of LUPIN LTD. was last trading in BSE at Rs.994.9 as compared to the previous close of Rs. 1034.25. The total number of shares traded during the day was 1356349 in over 20247 trades.

The stock hit an intraday high of Rs. 1060 and intraday low of 985.9. The net turnover during the day was Rs. 1367231424.

Source : Equity Bulls

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