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Last Updated : Nov 06, 2019 07:55 AM IST | Source:

Lupin Q2 preview: Profit may grow in double-digits on better operating income

Motilal Oswal expects EBITDA margin to grow 470 bps to 18.6 percent YoY on account of superior product mix and better operating leverage

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Pharma company Lupin is likely to report a double-digit growth in profit led by better operating income and revenue during the July-September period.

According to brokerage houses, profit, revenue and EBITDA (earnings before interest, tax, depreciation and amortisation) could grow more than 10 percent compared to the year-ago period.

"Revenue is expected to grow about 12 percent YoY on the back of 12 percent growth in the US, lead by generic Ranexa exclusivity and launch of generic Levothyroxine. EBITDA margins are likely to expand 459 bps to 18.5 percent mainly due to better product mix," ICICI Direct said.


According to the brokerage, net profit is expected to increase 18 percent YoY mainly due to better operational performance.

New tax reform will not be effective as it avails the benefits of the current tax regime.

Motilal Oswal expects EBITDA margin to grow 470bp to 18.6 percent YoY on account of superior product mix and better operating leverage.

"We expect Lupin to report moderate growth of around 10 percent YoY in its Q2FY20 revenue led by 13 percent/12 percent YoY growth in domestic formulations/Rest of World sales. This growth would be offset to some extent by subdued 5 percent growth in US generics segment on YoY basis," said the brokerage which remains positive on the stock due to the healthy pipeline for the US business and outperformance in the domestic formulations business.

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First Published on Nov 6, 2019 07:55 am
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