Cipla reported a 39% decline in net profit for the June quarter, attributed to weaker sales in the U.S. market. The company's profit fell to ₹789 crore, down from the previous year, as it faced an absence of two key products, lenalidomide and lanreotide. Revenue for the quarter increased marginally by 2% to ₹7,119 crore, while EBITDA dropped 33% to ₹1,192 crore, leading to a decrease in margins from 25.6% to 16.7%.
US Sales Outlook
Cipla's CEO Achin Gupta expressed optimism regarding the U.S. market, stating,
Our pipeline for the year is very promising,
which includes several significant launches. The company expects to ramp up sales in the U.S. with new product approvals, particularly three respiratory assets and one key peptide opportunity. The U.S. business generated revenue of $162 million during the quarter, accounting for 22% of total sales. Gupta noted,
We're expecting buildup through the coming quarters as we get these big product approvals.
Full-Year Guidance Maintained
Despite the weak performance in Q1, Cipla is maintaining its full-year guidance for EBITDA margins between 18.5% and 20%. The company aims for U.S. sales to reach a run rate of $1 billion by the end of the fiscal year. The domestic market showed strength, with revenues rising 12% year-on-year to ₹3,452 crore, contributing nearly half of the company's overall revenues.
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Cipla's performance may influence investor sentiment in the pharmaceutical sector, particularly regarding companies with significant exposure to the U.S. market. The focus on new product launches could drive stock performance in the coming quarters. Investors will watch for upcoming product approvals and their impact on sales growth in the U.S. market.