{"id":2840,"date":"2024-10-30T16:17:10","date_gmt":"2024-10-30T10:47:10","guid":{"rendered":"https:\/\/www.eqwires.com\/tutorials\/?p=2840"},"modified":"2024-10-30T16:17:11","modified_gmt":"2024-10-30T10:47:11","slug":"cipla-faces-challenges-of-slow-growth-drug-launch-analysts-slash-target","status":"publish","type":"post","link":"https:\/\/www.eqwires.com\/tutorials\/cipla-faces-challenges-of-slow-growth-drug-launch-analysts-slash-target\/","title":{"rendered":"Cipla faces challenges of slow growth, drug launch; analysts slash target"},"content":{"rendered":"\n

Shares of pharmaceutical giant Cipla dipped 5 per cent at Rs 1,403 per share on the NSE in Wednesday\u2019s intraday deals. This came after the analysts highlighted near term challenges for Cipla after it delivered its second quarter results for the financial year 2024-25 (Q2FY25). <\/small><\/p>\n\n\n\n

At 09:35 AM; the stock of the company was down 4.41 per cent at Rs 1,412.40 a piece. By comparison, the NSE\u2019s Nifty50 slipped 0.39 per cent at 24,371.20. <\/small><\/p>\n\n\n\n

In Q2FY25, Cipla\u2019s domestic business underperformed owing to seasonal weakness in anti-infective and trade generics business. However, this was offset by strong growth in one Africa and emerging markets and European business, said analysts. Meanwhile, growth in the US as well as India for Cipla was lower than what analysts expected at the global brokerage firm Nomura.\u00a0<\/p>\n\n\n\n

\u201cThe narrative for\u00a0Cipla\u00a0has worsened in the recent past, driven by US prospects and slowdown in India. Supply constraints in Lanreotide, potential competition in Lanreotide in due course, a delay in clearance of the Goa site resulting in Cipla failing to have the first- mover advantage (a competitor has gained approval) presents potential risks to earnings,\u201d analysts at Nomura said in a report.\u00a0\u00a0<\/small><\/p>\n\n\n\n

The pharmaceutical company is facing a temporary supply glitch in drug Lanreotide as its product partner is enhancing capacity. Analysts at Nuvama Institutional Equities said if this challenge persists till Q3FY25 then their FY27 estimates for the company could be at risk.<\/p>\n\n\n\n

They also highlighted a potential entry of Sun Pharma and Dr Reddy\u2019s Labs in Lanreotide in due course. Further, Cipla is also facing regulatory challenges at its Goa manufacturing facility, delaying the launch of the drug Abraxane, which is also a part of analysts earning FY27 estimates.\u00a0
\u201cWe are cutting FY26E\/27E EPS by 1 per cent each. With the key product challenges and high concentration risk (three products contribute 20 per cent of FY26E Ebitda), we retain \u2018Hold\u2019 on Cipla with a target price of Rs 1,593 (earlier Rs 1,663),\u201d Shrikant Akolkar, Aashita Jain, and Gaurav Lakhotia of Nuvama wrote in a report.<\/p>\n\n\n\n

\u201cWe are cutting FY26E\/27E EPS by 1 per cent each. With the key product challenges and high concentration risk (three products contribute 20 per cent of FY26E Ebitda), we retain \u2018Hold\u2019 on Cipla with a target price of Rs 1,593 (earlier Rs 1,663),\u201d Shrikant Akolkar, Aashita Jain, and Gaurav Lakhotia of Nuvama wrote in a report.<\/p>\n\n\n\n

Nomura, too, kept \u2018Neutral\u2019 rating on the Cipla stock with a target of Rs 1,568. Meanwhile, Investec retained \u2018Buy\u2019 on the company with a reduced target of Rs 1,800. UBS also gave a \u2018Buy\u2019 call with a slashed target of Rs 1,960. However, Bank of America gave an \u2018Underperform\u2019 rating to the stock with a sliced target of Rs 1,400.  <\/small><\/p>\n\n\n\n

On the upside, there are opportunities, too, for Cipla with a potential launch of Symbicort, Qvar and few more peptides over next two years, said Nuvama analysts, adding that the China facility commercialisation and first wave Semaglutide launch in India will also serve as positive catalysts for the company. <\/p>\n\n\n\n

Cipla, reported a 15.2 per cent year-on-year growth in its consolidated profit after tax (PAT), reaching Rs 1,303 crore for Q2 FY25, up from Rs 1,131 crore in the same quarter of FY24. <\/small><\/p>\n\n\n\n

Revenue from product sales rose by 5.6 per cent to Rs 6,961 crore, compared to Rs 6,589 crore a year earlier. This increase in net profit is attributed to strong domestic market performance, a favourable product mix, and operational efficiencies. <\/small><\/p>\n\n\n\n

Sequentially, revenue from operations grew by 5.1 per cent, while PAT increased by 10.6 per cent. Earnings before interest, tax, depreciation and amortisation (Ebitda) rose by 10.7 per cent year-on-year to Rs 2,076 crore, with an Ebitda margin reaching 26.7 per cent due to efficiency gains. <\/small>The Indian branded prescription business grew by 5 per cent, while revenue from the North American market was $237 million, reflecting a 4 per cent year-on-year increase driven by momentum in differentiated products.<\/p>\n\n\n\n

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Shares of pharmaceutical giant Cipla dipped 5 per cent at Rs 1,403 per share on the NSE in Wednesday\u2019s intraday deals. This came after the analysts highlighted near term challenges for Cipla after it delivered its second quarter results for the financial year 2024-25 (Q2FY25).  At 09:35 AM; the stock of the company was down 4.41 per cent at Rs 1,412.40 a piece. By comparison, the NSE\u2019s Nifty50 slipped 0.39 per cent at 24,371.20.  In … Continue reading “Cipla faces challenges of slow growth, drug launch; analysts slash target”<\/span><\/a><\/p>\n","protected":false},"author":2,"featured_media":2841,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[201,172,136,138,134,164,217,368,139,140,324,106,272,266,98,72,97,184,73,268,135,137,133,330,104,141,299,161,160,159,74,210,75,158,166,311,228,227,103,254,102,224,257,298,300,101,105,301,165,327,329,76,77,78,79,247,365,308,361,363,215,216,174,80,81,99,218,82,340,339,320,183,168,167,170,251,83,84,85,86,87,108,88,202,155,154,273,89,100,90,91,92,93,94,95,236,255,385,232,231,250,96,3,260,252,248,249,322,107,192,220,360,275,223,156,157,341,246,238,207,177,176,175],"tags":[4,5,267,6,200,7,12,116,19,149,147,173,145,14,118,11,150,153,265,120,9,271,190,191,13,188,18,318,8,185,316,10,17,269,148,151,146,15,331,319,16,122,144,162,23,41,25,24,27,21,194,50,312,229,226,124,33,253,126,225,119,20,258,28,297,49,127,315,121,230,295,125,115,22,113,29,328,333,317,332,334,314,52,123,131,348,366,357,309,310,359,362,354,349,351,364,213,26,182,111,130,31,62,34,30,42,219,57,112,186,169,56,171,64,132,206,59,53,264,128,43,336,242,237,51,110,32,187,35,55,44,270,288,196,47,37,195,45,39,36,40,203,38,143,152,129,142,46,48,63,67,60,61,65,234,71,235,54,256,117,386,233,68,193,241,335,205,261,263,209,262,337,244,66,204,70,109,259,221,291,274,222,163,69,58,342,239,208,114,178,181,179,180,290],"class_list":["post-2840","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-accurate-stock-tips-provider-in-india","category-best-advisory-service-provider-for-beginners","category-best-bank-nifty-future-calls","category-best-bank-nifty-options-tips-provider","category-best-bank-nifty-trading-tips-provider","category-best-equity-advisory-services-in-india","category-best-ethical-investment-advisor-in-india","category-best-financial-advisor-websites-in-india","category-best-index-future-services","category-best-index-options-services","category-best-intraday-advisor-in-india","category-best-intraday-call-provider","category-best-intraday-jackpot-calls","category-best-intraday-research-company","category-best-intraday-tips-for-tomorrow","category-best-intraday-tips-provider-in-india","category-best-intraday-tips-site","category-best-intraday-tips-website-in-india","category-best-investment-advisor-in-india","category-best-jackpot-tips-provider","category-best-nifty-future-calls","category-best-nifty-options-tips-provider","category-best-nifty-trading-tips-provider","category-best-option-trading-telegram-channel","category-best-options-tips-provider-in-india","category-best-options-trading-tips-provider-in-india","category-best-paid-stock-recommendation-sites-india","category-best-performing-pms-in-india","category-best-pms-in-india","category-best-portfolio-management-services-in-india","category-best-sebi-registered-advisory-company","category-best-sebi-registered-investment-advisor","category-best-sebi-registered-investment","category-best-sebi-registered-research-analyst","category-best-sebi-registered-stock-tips-provider","category-best-sebi-registered-telegram-channel","category-best-share-market-advisor-in-india","category-best-share-market-advisory-company-in-india","category-best-share-market-consultants-in-india","category-best-share-market-tips","category-best-share-market-tips-provider-in-india","category-best-share-tips-provider-in-india","category-best-stock-advisor","category-best-stock-advisor-websites-in-india","category-best-stock-advisory-service-in-india","category-best-stock-market-advisory-services-in-india","category-best-stock-market-tips-provider-service","category-best-stock-recommendation-service-in-india","category-best-stock-tips-provider-in-india","category-best-stock-tips-provider-in-telegram","category-best-telegram-channel-for-stock-market-tips-in-india","category-business","category-commodity-market","category-currency","category-equity-market","category-equity-research-analyst","category-eqwires-best-investment-advisor-in-india","category-eqwires-best-sebi-registered-investment-advisor-in-india","category-eqwires-best-stock-advisor-websites-in-india","category-eqwires-most-successful-stock-advisors-in-india","category-ethical-sebi-registered-investment-advisor","category-ethical-sebi-registered-research-analyst","category-fact-about-operator-based-calls","category-fii-based-calls","category-foreign-markets","category-free-intraday-stock-tips-for-tomorrow","category-genuine-intraday-tips-provider","category-genuine-stocks-tips-provider","category-googles-highest-ranking-sebi-registered-research-analyst","category-googles-highest-ranking-sebi-registered-stock-advisory-company","category-high-accuracy-intraday-tips","category-how-can-i-make-profit-in-intraday-trading","category-how-to-earn-profit-from-intraday-trading","category-how-to-invest-in-stock-market","category-how-to-make-profit-in-intraday-trading-in-share-market","category-intraday-tips","category-intraday-trading-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