Company Update : Lupin Ltd by Motilal Oswal Financial Services Ltd
Strong beat on estimates
* Lupin's (LPC) 2QFY26 revenue grew 27% YoY to INR70.5b. (our est. INR64.5b).
* US sales grew 47.3% YoY to INR27.6b (up 41% YoY in CC to USD315m; 39% of sales).
* Domestic formulation (DF) sales grew 3.4% YoY to INR20.7b (29% of sales).
* Other developed market sales grew 18.9% YoY to INR8b (12% of sales).
* Emerging market sales grew 45.3% YoY to INR 9.2b (13% of sales).
* API sales decreased 12.8% YoY to INR2.5b (4% of sales).
* Gross Margin (GM) expanded 460bp YoY to 74.1% due to a reduction in raw material costs.
* EBITDA margin expanded 800bp YoY to 30.3% (our est: 25.5%), largely due to improved GM. The benefit was partly offset by higher employee costs (+250bp YoY as a % of sales).
* As a result, EBITDA grew 72.8% YoY to INR21.4b (vs our est: INR16.5b).
* Adj. PAT grew 72.8% YoY INR13.3b (our est: INR10.3b).
* We await clarity on the PLI income received during the quarter.
* For 1HFY26, revenue/EBITDA/PAT grew 19%/45%/48% YoY.
Other highlights
* LPC received six ANDA approvals in 2QFY26.
* LPC launched six products in 2QFY26.
* R&D was 7.5% of sales for the quarter.
* Capex for the quarter was INR3.4b.
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