1. Cipla beats estimates for Q3 profit

Cipla beats estimates for Q3 profit

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2 min read • Updated: January 22, 2024, 9:22 PM

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Summary

Cipla, a generic drug company in India, saw a 32% increase in third-quarter profit, surpassing analysts' expectations. The growth was driven by strong performance in the North American market, with consolidated net profit reaching 10.56 billion Indian rupees. This beat the average estimate of 10.43 billion rupees.

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Cipla posted a bigger-than-expected 32% rise in third-quarter profit

BENGALURU/HYDERABAD, Jan 22 (Reuters) - Indian generic drugmaker Cipla on Monday reported its third-quarter profit above analysts expectations, boosted by strong performances in North American and domestic markets.

Consolidated net profit rose 32% to ₹1056 cr ($127.1 million) in the quarter ended Dec. 31 from a year earlier, compared with average analysts' estimate of ₹1043 cr, according to LSEG data.

Sales in North America grew 20% during the quarter, partially driven by strong demand for Cipla's generic version of Bristol Myers Squibb's cancer treatment drug Revlimid. Over the past five quarters, the company has recorded sales growth ranging from 32% to 52% in the region.

Sales in India grew 11.6%, helped by robust demand for branded prescription drugs and consumer health products, including popular items such as the rehydration drug ORS and Nicotex, a chewing gum designed to manage the urge to smoke.

The combined revenue from India and the U.S. contribute around 70% to Cipla's total revenue.

The overall revenue for the quarter rose by 13.6%, surpassing analysts' expectations of a 12% increase.

Other generic drugmakers such as Dr Reddy's and Sun Pharma have also benefitted from sales of their own versions of Bristol Myers Squibb's cancer drug.

Meanwhile, Cipla's total costs increased about 9%, primarily due to inventory-related costs and other expenses.

Additionally, there have been reports of the company's founding family considering selling its 33.4% stake, a matter CEO Umang Vohra played down in October.