Feb 5 (Reuters) – Indian drugmaker Alembic Pharmaceuticals on Thursday reported lower third‑quarter profit on Thursday after taking a one-time charge linked to India’s new labour code, despite strong demand for its generic drugs and new product launches in its key U.S. market.
The company’s consolidated profit fell to 1.33 billion rupees ($14.7 million) in the quarter ended December 31, from 1.38 billion rupees a year earlier.
Alembic took up a one-time charge worth 301 million rupees linked to India’s new labour codes. Excluding the charge, profit rose nearly 15%.
Revenue from operations jumped 11% to 18.76 billion rupees.
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KEY CONTEXT
Alembic Pharmaceuticals and several Indian generic drugmakers derive a large share of their revenue from the United States. The sector received a boost in October after U.S. President Donald Trump shelved plans to impose tariffs on generic drug imports.
Stronger U.S. sales for Alembic were also supported by new drug approvals, including a hypertension treatment and an antidepressant, which helped drive growth in the market.
By contrast, larger peers Cipla and Dr Reddy’s Laboratories posted subdued North America sales, weighed down by price erosion in key products, including the generic cancer drug lenalidomide.
PEER COMPARISON
Valuation Estimates Analyst
(next 12 (next 12 s’
months) months) sentime
nt
RIC PE EV/EBI Price/ Revenue Profit Mean # of Stock to Div
TDA Sales growth growth rating* analyst price yield
s target** (%)
Alembic ALEM. 18.77 12.08 NULL 10.63 22.94 Buy 11 0.78 1.38
Pharmaceuticals Ltd NS
Zydus Lifesciences ZYDU. 21.45 14.60 3.34 7.17 -10.15 Hold 29 0.90 1.22
Ltd NS
Cipla Ltd CIPL. 23.33 15.05 3.45 7.82 0.47 Hold 37 0.91 0.98
NS
Dr Reddy’s REDY. 21.93 13.14 2.84 3.30 -10.28 Hold 39 0.93 0.65
Laboratories Ltd NS
* 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
OCTOBER TO DECEMBER STOCK PERFORMANCE
— All data from LSEG
— $1 = 90.2200 Indian rupees
(Reporting by Kashish Tandon in Bengaluru)
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