Natco Pharma hits new low

Natco Pharma opened today at a new 52-week low at Rs.482, going down over 8%. Though it has recovered from this low, the stock remains in the red, down some 4% and figures among the top three losers on the BSE currently.

The market was very disappointed with the company’s earnings for Q4FY19. Consolidated net profit showed a sharp 60% (YoY) decline at Rs.120 crore and this was on a 38% drop in net revenue at Rs.788 crore.

The decline in profit was primarily due to write-off of Oseltamivir inventory by its marketing partner in the USA. The flu-season in USA was weaker than expected resulting in the write-off of this inventory valued at approximately US$ 5.5M. What helped set this off was the domestic business, where despite intense price pressures, it saw a growth in Oncology segment.

The Board of Directors has declared third interim dividend of Rs.1.25 per equity share of Rs.2/- each, resulting in a total dividend payout of Rs.6.25 per equity share for FY19.

The company ended FY19 with an 8% decline in consolidated net profit at Rs.642 crore on a very flat revenue of Rs.2225 crore.