Ranbaxy Posts 310% Growth In The Net

Top pharma company Ranbaxy has beat the street expectations as its net profit jumped 310% to Rs 1246 crore. This was largely aided by the 180 day exclusivity for Lipitor in USA. This quarter saw full 3 months of exclusivity of Lipitor. Company also has launched this product in Europe and Australia. Total sales were Rs 3700 crore, up 72% from Rs 2145 crore in the corresponding quarter last year. In the dollar term the growth was 55% indicating heavy rupee depreciation has helped company to increase the realizations. EBITDA margins remained strong at 27% compared to 20% in March quarter last year.

Growth was robust in all geographical territories with growth rates in North America remaining as high as 145%. The contribution of revenues from North America increased form 36% to 57% in this quarter. The Indian business grew moderately by 10%. European operations showed a flat growth while in other markets, revenue grew by 12%.

The regulatory activity was also good where company made total 53 dosage form fillings and received 20 approvals. Further company launched Synriam, an anti malarial drug in this quarter. Company has commissioned production from Mohali facility which in the coming days will help it to increase the dispatches to USA.

Ranbaxy is under the consent decree with USFDA and has already made a provision of Rs 2648 crore as the potantial settlement penalty. The outcome of the same will help company to improve its performance. At the moment it is not clear about the improvements in the same manner. We believe that as the 180 day exclusivity will end the earnings will get normalized. Company may have forgone the benefit of 3 first to file drugs and there is also less clarity on the same. We will update our readers on the management commentary after the conference call.

Table 1 Ranbaxy March Quarter Results (In Rs Crore)