(Reuters) -Indian drugmaker Alembic Pharmaceuticals posted a 20.4% rise in second-quarter profit on Tuesday, aided by strong demand for its generic drugs as well as new launches in its key U.S. market.
The company’s consolidated profit rose to 1.85 billion rupees ($21.05 million) in the quarter ended September 30.
Revenue from its U.S. generics business jumped 21% to 5.66 billion rupees, helping overall revenue rise 16% to 19.10 billion rupees.
For further results highlights, click [here]
KEY CONTEXT
Alembic Pharma and several of Indian peers that make generic drugs derive a significant share of revenue from the United States. In October, U.S. President Donald Trump shelved plans to impose tariffs on generic drug imports, providing relief to companies in the sector.
In addition, new drug approvals in the U.S., including a hypertension drug and an antidepressant drug, led to strong growth in the geography for the company.
Larger peer Cipla reported growth in the U.S. market in the reporting quarter, while Dr Reddy’s Laboratories highlighted a decline in revenue in the North America segment due to price erosion in key cancer drug generic lenalinomide.
PEER COMPARISON
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBITDA Price/ Revenue Profit Mean No. of Stock to Div
Sales growth (%) growth rating* analyst price yield
(%) s target** (%)
Alembic ALEM.NS> 23.11 14.26 NULL 9.99 22.00 Buy 12 0.90 1.19
Pharmaceuticals
Dr Reddy’s 20.33 12.41 3.13 2.57 -9.83 Hold 39 0.91 0.67
Laboratories
Cipla 24.38 15.59 3.79 7.48 0.18 Buy 37 0.90 0.86
Zydus Lifesciences 22.87 14.78 3.94 6.01 -6.98 Hold 26 0.95 1.12
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
JUNE-SEPTEMBER STOCK PERFORMANCE
— All data from LSEG
— $1 = 87.0650 Indian rupees
($1 = 87.8950 Indian rupees)
(Reporting by Abhirami G from Bengaluru; Editing by Janane Venkatraman)
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