The stock jumped after the company on Friday reported a two-fold jump in consolidated net profits. Its revenues grew 78.2 per cent. The agrochemical firm also managed to expand profit margins.
The company said it plans to build its own sales force, expand and strengthen distribution presence, continual investment in product registrations and focus on operational efficiencies. The company also announced a Rs 3 per share dividend.
The numbers and commentary boosted investor appetite for the stock on an otherwise bleak day for the market.
stands tall
Similar to Sharda Cropchem, Cipla stood tall among Nifty stocks, rising nearly 3 per cent. It was one of the two gainers in the index on Monday. The buying seems to be prepositioning ahead of its earnings scheduled tomorrow.
This is despite analysts expecting lukewarm numbers from the company, given a number of headwinds. Analysts at Sharekhan said revenue’s growth to be almost flat YoY due to a decline in India sales. Margins may also contract due to reduced Covid opportunities and increasing other expenses.
Emkay analysts expect Cipla’s US revenue to be $140 million as market share gains in Albuterol and Brovanna will be offset by price erosion in Albuterol due to Hikma’s entry. They further expect a modest 5 per cent YoY growth in the India business due to tough comparables from Q3FY21.
Black to red
Shares of Rane (Madras) plunged over 6 per cent after the company said it suffered a loss during the December quarter. The auto parts company reported a consolidated loss of Rs 4.3 crore.
The management said Q3 was a challenging quarter with semiconductor shortage impacting the supply chain across served customers and geographies. Also commodity prices remained at elevated levels impacting profitability.
“The US subsidiary sustained the improved operational performance. We hope the third wave of coronavirus in India does not adversely impact the demand environment,” it added.
