Lupin Ltd. share price target

US Biz to Dampen FY18 Performance; Maintain HOLD Led by weak performance in the US and muted growth domestic business, Lupin (LPC) has delivered a weak performance in 1QFY18 on all counts. Its revenues, EBITDA and net profit declined by 13% YoY (9% QoQ), 41% YoY (31% QoQ) and 59% YoY (49% QoQ), respectively. Notably, LPC's US sales declined by 26% YoY to US$238mn compared to US$322mn and US$276mn in 1QFY17 and 4QFY17, respectively primarily owing to decline in gGlumetza sales. As per the Management, the US branded business (+21% QoQ to US$23mn) reported a better sales growth in 1QFY18 compared to the generics business. Its domestic sales declined by...

For 4QFY2017, Lupin posted results which were much below expectations mainly on OPM and the net profit front. The revenues came in at `4,162cr v/s. `4,338cr, a yoy growth of 1.3%. On the OPM front, the EBDITA margins came in at 16.6% (v/s. 25.7% expected) v/s. 31.2% in 4QFY2016. Thus, the Adj. PAT during the quarter came in at `380.3cr v/..

Revenue fell by 5.52% to Rs. 4161.88 Cr in Q4FY17 when compared to the previous quarter.

Provision for a potential legal liability of Rs 1.6bn, high forex losses of Rs 1.7bn and an R&D expense of Rs 6.7bn (15.8% of net sales) led to a surprise sequential drop in Lupin?s (LPC) EBITDA margin to 18.4% in 4QFY17. As a result, net profit declined ~50%YoY to Rs 3.8bn. Revenue at ~Rs 41bn missed estimates by 8 to 9%, owing to lower US sales.

Background: Amongst the largest Pharma companies in domestic market with Net Sales of INR 171.2bn with a strong brand portfolio. R&D; cost is in excess of 13% of Sales. Exports account for 73% with Developed Markets (DM) at 58% and EM at 15%. Sales Mix: API - 10%, Domestic Formulations - 25%, DM Formulations - 56%, EM Formulations - 9%. Historically strong in anti-TB segment, has built expertise in fermentation based products and segments like...

ICICI Securities Ltd | Retail Equity Research Revenues grew mere 2% YoY to | 4253 crore (I-direct estimate: | 4402 crore) mainly weighed down by 13% de-growth in US to | 1901 crore (I-direct estimate: | 2055 crore). India formulations grew 15% to | 879 crore (I-direct estimate: | 876 crore) while Japan grew 36% Japan to | 469 crore (I-direct estimate: | 505 crore) EBITDA margins declined 1292 bps YoY to 18.4% (I-direct estimate: 31.3%) owing to one-off provision of | 156 crore, forex loss of | 168...

headwinds with growth to be impacted across all markets including US, Japan and India. Lupin's US business faces significant headwinds from price erosion (~10-12%) in the base business as well as high value products. In Japan, Lupin could be hit by a pincer where authorities not only mandate more frequent price revisions (annually) across all product categories but also want to direct business to the top 5 generic companies in each product category. On the India front frequent regulatory intervention is already taking a toll on the overall domestic business growth. US structural weakness is the biggest risk The US market which is the mainstay for...

Management has guided for pain to continue until FY19 in the US markets and some delays in launches but is confident on continuous launches from India/Somerset with a focus on 30+ launches in FY18/19E to support the base business. India business to grow ahead of IPM, however, pain in Japan on the back of new norms. Lupin also has a strong NCE pipeline but...

Higher Price Erosion to Impact US Business Lupin (LPC) has delivered a weak performance in 4QFY17. Its revenues rose by just 1.7% YoY to Rs42.5bn, while adjusted PAT declined by 12.7% YoY to Rs7bn. Lower US sales at US$276mn (vs. our estimate of US$336mn owing to drop in gGlumetza/gFortamet sales) and lower channel filling for gMinastrin 24Fe dragged its top-line performance. However, its domestic sales grew by 13.8% YoY Rs8.8bn, while Japan business surged by 41.8% YoY Rs4.9bn. LPC booked two oneoff expenses i.e. forex loss of Rs1.7bn and Rs1.6bn provisioning towards patent litigation loss in Australia, adjusted for which its EBITDA dipped by 19% YoY to Rs11.0bn, while adjusted EBITDA margin stood at ~26%. Its R&D; spend rose to ~16% of sales in 4QFY17 vs. 12.9% and 12.5% in...