Lupin: Q4FY14 Result Analysis

Lupin announced it’s results for the quarter ended March’14. The company posted a 36% rise in net profit on YoY basis for Q4FY14. The figures are well ahead of the street estimates. Total revenue in the quarter grew 20% to Rs 3051 crore against Rs 2,537 crore for Q4FY13 due to growth in its formulation business. Lupin’s formulation business grew 20% to Rs 2760 crore from Rs 2294 crore and the API business jumped 20% to Rs 291.4 crore against Rs 243.6 crore during the quarter. EBITDA grew 32% to Rs 807 crore from Rs 610 crore, while operating margins stood at 26.5% against 24% reported during the same period last fiscal.

On May 07, Lupin had organized its annual investors meet in Mumbai. Below mentioned are the key highlights of the presentation shared by the management:

• US generics to sustain constant currency growth of 15-18% led by pending pipeline of 93 ANDAs that includes 15 FTFs during FY14-16
• Expects 15-20 ANDA approval in FY15
• US base business continues steady progress led by both volume and price rise
• Enhanced focus on specialty generics like - injectables, controlled substances, opthalmics, Respiratory, derma, biosimilar etc ensures profitable growth FY17 onwards
• Technology focused brand/business/company acquisition remains key priority in US
• Domestic business to see normalized growth over 15% in FY15
• Its Japanese kwoya business to see double digit growth but I'rom operation to remain subdued as Lupin is strategically reducing contract manufacturing operation there
• Overall Lupin indicates for consolidated sales growth in the range of 17-20% and margins to consolidate in the range of 25-26%
• Lupin indicates its 3 priorities like - Profitability, technology led drug pipeline and M&A to drive sustained value growth in future

The Board has proposed a final dividend of Rs 3 per share making it a total dividend of Rs 6 for FY 2013-14.