Cipla leaves a very bitter taste

Cipla hit a new 52-week low today at Rs.458.25 on the back of its poor show for Q4Fy16. The numbers were very disappointing as most analysts had expected an increase in the bottomline.

The company reported a very sharp 69% (YoY) fall in net profit for Q4FY16 at Rs.81 crore though income from operations rose 6% at Rs.3267 crore. This fall can be blamed entirely on various one-time expenses – restructuring expenses, write-off on inventory reduction, changes in payment of Bonus Act. In terms of revenue, domestic sales rose 16% while exports showed a small 3% increase.

EBITDA for the quarter was down 57% at Rs.3266 crore while margins showed a very steep decline from 16.4% to 6.7%. The company had a tax credit of Rs.4 crore and that to some extent arrested a much steeper fall in net profit.

For Fy16, the company’s consolidated net sales showed a 23% rise at Rs.13372 crore and net profit rose 27% at Rs.1506 crore. Equity stands at Rs.161 crore and EPS is at Rs.19 (FV of Rs.2/share). Borowings stand at Rs.5191 crore.