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BL Research Bureau

Lupin’s June-quarter consolidated net profit doubled to Rs 112 crore boosted by a strong performance in both its local and international businesses.

The stock closed 1 per cent up, after touching 52-week high of Rs 760 on Wednesday.

The growth in the international markets was led by 55 per cent growth in US formulation business, which benefited from successful US launch of generic Ramipril (anti-hypertension), where it claims 45 per cent market share, and a brand extension of Suprax (antibiotic).

Over 20 products are awaiting US regulator’s approval which would provide key support to the US business in the coming quarters. Domestic formulation business, which has historically grown faster than industry, went up by 25 per cent with growth coming from medicines catering to lifestyle diseases.

Kyowa (Japan), which Lupin had acquired in October 2007, pitched in with 14 per cent of overall formulation revenues - helped by launches of product approvals received in April.

Lupin’s contract manufacturing business through new entity Novodigm (erstwhile Rubamin which was acquired in September 2007) notched up sales of Rs 8.2 crore.

Leaving out Kyowa and Novodigm, Lupin’s (organic) revenues grew by 32 per cent on a year-on-year basis; which is decent. On the operational front, the company’s consolidated margins improved significantly to 18 per cent as against 14 per cent in the corresponding period last fiscal.

Also, total manufacturing expenses which came down to 27 per cent of net sales as compared with 33 per cent, helped boost margins. R&D costs for the three months ended June 30 were about 5 per cent (Rs 41 crore) of revenues.

Lupin’s drug discovery assets (has four molecules) may be monetised by out-licensing soon.

Lupin’s net profit margins stood at 13 per cent, which may be maintained in the future with strong franchise in domestic formulation market and front-ended presence in the US. Quarterly earnings per share (diluted) zoomed by 99 per cent to Rs 13.58.

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