Biocon Surges On ‘Healthy’ Sales, Net Profit Stands At Rs 113 Crore In Q4

Biocon, one of India’s largest biotechnology company declared its fourth quarter result yesterday (April 24, 2014).The company has reported a growth of more than 14% YoY in the topline to Rs 728.53 crore for the quarter ended March 2014. The net profit of the company has expanded by 142% on YoY basis to Rs 113.08 crore during Q4FY14 excluding the exceptional earnings during the same quarter of the previous year. The exceptional earnings of the company during the Q4FY13 was Rs 201.91 crore, on account of the deal with Mylan. While including the exceptional earnings the PAT of the company has plunged by 54.52% YoY during Q4FY14.

While on segment wise performance, the Pharma segment of the company which contributes around 73% of the total revenue has seen 14.6% growth to Rs 536.77 crore on yearly basis during Q4FY14. The Contract Research and Manufacturing Services (CRAMS) have shown a growth of 12% YoY to Rs 194.90 crore during Q4FY14.

On the operating profit front, the EBITDA of the company has surged 56.6% YoY to Rs 175.55 crore during Q4FY14. As far as margin is concerned, the EBITDA margin rose by 650 basis points to 24.10% during Q4FY14. The main reason behind the increase in margin is due to reduction in cost of raw materials. The cost of raw materials which accounts for 40% of the total expenditure has dropped by 11.25% YoY, standing to Rs 242.45 crore during Q4FY14.

The branded formulations vertical of the company has grown by 9% YoY to Rs 93 crore during this quarter, whereas the industry in this segment has grown by 7% YoY during Q4FY14. This was due to robust performance of the flagship brands of BioMAb EGFR, Abraxane, Insugen and Basalog. The company has also launched a trastuzumab product, CANMAb in India during the last quarter of FY14. 

Commenting on the developments CMD, Kiran Mazumdar Shaw said, “We have delivered on our promise of affordable innovation through commercialization of Alzumab, an anti-CD6 novel biologic for Psoriasis; and CANMAb, the world’s most affordable trastuzumab. We are pleased that a large number of patients benefited from these two products.” 

On the outlook, the company has said that they will continue to make investments in infrastructure and they expect FY15 to reflect continued business momentum with biosimilars, branded formulations and research services driving growth. The company also said that the progress in the development pipeline (across biosimilars and novel molecules) will see some of their molecules to enter the clinic.

On the valuation front, the company is trading at 17.2x of its trailing twelve months earnings. The company has also recommended a dividend of Rs 5 per share for the fiscal year 2014.