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Cipla Q1 results: Profit likely to fall 14%, US sales may take a hit

Centrum expects South Africa and RoW also to remain under pressure in terms of growth and R&D spend to remain higher around 8 per cent of sales.

ETMarkets.com|
Aug 07, 2019, 10.22 AM IST
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Kotak Institutional Equities projected a 13.50 per cent year-on-year (YoY) fall in adjusted net profit on 7.40 per cent rise in net sales in Q1FY20.
NEW DELHI: Pharma major Cipla is expected to report subdued quarterly results today for the quarter ended June 2019 following muted growth in domestic formulations.

Kotak Institutional Equities projected a 13.50 per cent year-on-year (YoY) fall in adjusted net profit on 7.40 per cent rise in net sales in Q1FY20. The brokerage firm also expects that EBITDA margins to contract 285 basis points to 19 per cent, with R&D likely to remain at 7.7 per cent of sales.

Kotak also projected 14 per cent YoY fall in EPS for Cipla in the June quarter. “We expect domestic formulations growth to be muted with 7 per cent YoY growth. US sales to decline by $30 million to $135 million in the quarter, given erosion in cinacalcet, as well as diclofenac gel,” it said.

An assessment by Centrum Institutional Research projected a 14.80 per cent YoY fall in adjusted net profit for the pharma firm. It expect domestic formulations growth to be muted at 5 per cent YoY and US sales to be lower given erosion in cinacalcet.

Centrum expects South Africa and RoW also to remain under pressure in terms of growth and R&D spend to remain higher around 8 per cent of sales.

Shares of Cipla were trading 0.76 per cent up at Rs 504 at around 9.30 am (IST), while the benchmark BSE Sensex was down 57 points, or 0.15 per cent, at 36,919 at around the same time.

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