Views on Lupin Limited 4QFY2017 Results: Angel Broking

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

"The company for 4QFY2017, posted results much below expectations mainly on OPM and the net profit front. The revenues came in at INR 4,162cr V/s INR 4,338cr, a YoY growth of 1.7%. The sales were impacted on back of the USA (INR 1901cr), a YoY dip of 13.2%. Other significant markets India (INR 878.8cr) a YoY growth of 13.8% YoY, APAC (INR 612cr), a YoY growth of 35%, EMEA (INR 301.2cr), a YoY growth of 22.8%, LATAM (INR 126.9cr), a YoY growth of 37.3%.

On the OPM front, the EBDITA margins came at 16.6% V/s 25.7% expected V/s 31.2% in 4QFY2016. While the Gross margins came in at 71.5% V/s 73.8%, a YoY rise of 24.4%, 31.3% and 37.7% in the employee, R&D and other expenses lead the contraction in the OPM, higher than expected. Net Impact of foreign exchange fluctuation on EBITDA was a loss of INR 1,68cr during 4QFY2017 as compared to a gain of INR 26.7cr during 4QFY2016 and a gain of INR 27.6cr during 3QFY2017. Also, the company made a provision for liability towards its Australian subsidiary amounting to INR 155.9cr, in respect of compensation for patent litigation towards its Isabelle generic launch in Australia. These aided the contraction in the OPM.

Thus, the Adj. PAT during the quarter came in at INR 380.3cr V/s INR 710.6cr expected, a YoY dip of 52.9%. Given the valuations, we maintain our BUY rating on the stock."

Shares of LUPIN LTD. was last trading in BSE at Rs.1137.95 as compared to the previous close of Rs. 1227.65. The total number of shares traded during the day was 510958 in over 18877 trades.

The stock hit an intraday high of Rs. 1180.65 and intraday low of 1108. The net turnover during the day was Rs. 580192403.

Source : Equity Bulls

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