Shares of Syngene International were sharply lower, down between 4-5% on January 24, after the company lowered its full year guidance during the third quarter earnings report, citing delay in demand recovery.
"Growth observed in the quarter indicates that market dynamics, particularly within the US biotech sector, are stabilizing. However, the recovery in demand, which was expected in the second half of the year, experienced a delay of approximately 8 to 12 weeks," said the company.
After the Q3FY25 fineprint, Jefferies has issued a Hold rating on the stock and lowered the target price to Rs 860 per share from Rs 890, adding that a flat profit for FY25 will mark the second year of weak growth for the contract research player.
Syngene International reported a 11% on-year growth in revenue from operations at Rs 944 crore, profit after tax higher by up 18% on-year at Rs 131 crore. "Growth in the quarter suggests that market dynamics, particularly in US biotech, are stabilising, albeit later than expected," Jonathan Hunt, Managing Director and CEO, Syngene International said.
"Despite the challenges faced in the first half of the year, the company expects to close the full year with single-digit revenue growth and a flat PAT. EBITDA guidance remains unchanged," the statement by Syngene said. The company said it returned to growth in third quarter and foresees the growth momentum continuing into the fourth quarter.
Syngene International has a market capitalization of over Rs 32,000 crore and the shares are up 17% over the last one year, but lower by 8% so far in 2025.
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