India`s Gland Pharma reports higher Q3 profit as expenses drop
Indian generic injectables maker Gland Pharma reported a 7% rise in third-quarter profit on Monday, as lower expenses helped mitigate the impact from production issues at its French unit Cenexi.
The company reported consolidated net profit of 2.05 billion rupees ($23.5 million) for the quarter ended Dec. 31, in-line with analysts' estimates of 2.04 billion rupees, as per data compiled by LSEG.
Revenue from operations declined 10.4% to 13.84 billion rupees, falling short of analysts' expectations. However, its total expenses also dropped 11% due to lower inventory costs.
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KEY CONTEXT
Production setbacks at Cenexi's sites in Paris and Belgium and hurt revenue, Gland Pharma said in a press release.
Sales from Gland Pharma's Europe business fell 19%, while U.S. sales dropped 11%.
Most Indian generic drugmakers derive a significant share of revenue from the U.S., where intensifying competition has proven a drag on their earnings.
Rivals Sun Pharma and Cipla beat third-quarter profit estimates, while Dr Reddy's missed expectations. All three drugmakers saw muted growth in the North American market, including the U.S.
PEER COMPARISON
Estimates (next 12 Analysts' sentiment
months)
RIC PE EV/EBI Revenue Profit Mean # of Stock to Div
TDA growth growth rating* analysts price yield
(%) (%) target** (%)
Gland Pharma Ltd 25.10 13.80 11.96 27.51 Hold 10 0.89 1.31
Zydus Lifesciences 21.34 14.42 7.84 4.22 Hold 28 0.89 0.31
Ltd
Cipla Ltd 22.94 14.46 8.20 5.96 Buy 33 0.88 0.88
Dr Reddy's 17.20 10.77 10.17 6.15 Hold 35 0.90 0.66
Laboratories Ltd
* Mean of analysts' ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** Ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the PT
OCTOBER TO DECEMBER STOCK PERFORMANCE
-- All data from LSEG
-- $1 = 87.1020 Indian rupees
