Cipla

Cipla disappointed after its net profit for Q3FY14 fell 23% (YoY) at Rs.261 crore though net sales showed a growth of 10% at Rs.2281 crore. EBITDA was down 18% at Rs.403 crore and EBITDA margin was down by a sharp 610 bps at 17.7%. Higher raw material cost, which was 39% of net sales compared to 38% YoY and other expenses –higher staff costs and higher R&D expenses together increased overall operating costs.

Domestic revenues grew by  13%  and this was led by growth in respiratory, anti-infectives and cardiology segments. In international business,  exports of formulations grew by 34% to Rs.1352 crore and export of APIs grew by 14%. Growth in export revenues was primarily due to growth in anti-retroviral, anti-cancer, anti-allergic and anti-biotic segments. Currently, exports make for 51% of Cipla’s revenue and balance 49% is from India. And in terms of mix, formulations make for the lion’s share at 94% and APIs is meager at 6%.