Lupin posts 35% rise in Q4 net profit

Lupin has clocked a 35% jump in its Jan-Mar (Q4) consolidated net profit to Rs 389.6 crore on account of a one-time gain accrued from the divestment of its stake in Japanese firm Kyowa Pharmaceuticals even as the company’s operational performance was hit by a fall in sales in US and Asia Pacific markets.

The Mumbai-based drug-maker had in November announced the sale of entire 99.82% stake in its Japanese subsidiary Kyowa Pharmaceutical Industry Co for an enterprise value of 57.4 billion yen to Plutus, a firm owned by Japanese private equity firm Unison.

While most of the profit from the sale was accounted for in the December quarter, about Rs 121 crore million was accounted for in the Jan-Mar quarter. However, this was offset by a loss of Rs 284 crore in the divestment of another Japanese firm Kyowa Criticare as well as Rs 9.6 crore worth of impairment, according to a company statement.

Lupin’s sales in the Indian market rose 13.3% to Rs 1,192 crore in Q4, while that in the North American market declined 9.3% to Rs 1,579 crore. Asia Pacific sales were also down 15.5% at Rs 144.7 crore.

Latin American and rest of the world also reported a fall in sales and as a result Lupin’s consolidated sales were down 0.4% at Rs 3,791 crore in the quarter under review.

Weak sales also led to a contraction in the company’s operating margin to 19.4% from 22.4% in the corresponding period last year.

However, despite the weak operational performance Lupin management maintains a positive outlook for quarterly sales.

Additionally, Lupin has also chalked out a product and cost rationalisation drive, the result of which could be visible two to three years down the line

The board of directors of the company has recommended a dividend of Rs 6 per equity share of the face value of Rs 2 each aggregating to Rs 271.84 crore.

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