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Piramal Pharma net profit declines sharply by over 75% in Q4

Our Bureau, Mumbai
Friday, May 26, 2023, 10:30 Hrs  [IST]

Piramal Pharma, a demerged pharma entity from Piramal Enterprises, has received major setback during the fourth quarter ended March 2023 and its consolidated net profit declined sharply by 75.5 per cent to Rs. 50 crore from Rs. 204 crore in the corresponding period of last year. The revenues remained almost stagnant at Rs. 2,163 crore as compared to Rs. 2,131 crore, a growth of 1.5 per cent. Due to scheme of demerger pharma undertaking with effect from April 2022, the results are not strictly comparable.

The sales from contract development and manufacturing organisation (CDMO) division declined slightly by 2.8 per cent to Rs. 1,285 crore during the fourth quarter ended March 2023 from Rs. 1,322 crore. Contribution from CDMO worked out to 57 per cent of total sales. CDMO sales witnessed a significant pickup in order bookings in Q4 compared to the previous three quarters. The orders received during Q4 was a healthy mix of on-patent and generic product development and manufacturing. Sales from complex hospital generics went up by 27.6 per cent to Rs. 550 crore. Its sales from India Consumer Healthcare division declined by 23.2 per cent to Rs 206 crore.

North American sales worked out to 45 per cent and European sales around 20 per cent of total sales. Its domestic sales contributed 20 per cent and other markets, including Japan, sales were 15 per cent of total.

Nandini Piramal, chairperson, said, “Over the recent years, Q4 has always been the strongest quarter for the company in terms of revenue contribution and EBITDA margin. This year as well, we have seen a healthy pickup in our Q4 revenues and EBITDA margin compared to previous three quarters of the financial year. Our CDMO business, which had a challenging year, witnessed significant pickup in order bookings in Q4. Our inhalation anaesthesia portfolio continues to see a healthy demand and hence we are expanding our capacities. Our India Consumer Healthcare business is delivering good growth driven by our power brands. We continue to maintain our quality track record with successful US FDA inspections – zero observations at Riverview and Digwal facilities, and EIR received for Lexington and Sellersville facilities. We believe in the potential of our businesses and our main focus over the next few months will be on capturing demand and executing them well, driving productivity through operational excellence and executing critical maintenance and growth capex.”

For the full year ended March 2023, Piramal Pharma suffered setback and it incurred a net loss of Rs. 186 crore as against a net profit of Rs. 376 crore in the previous year. EBITDA also declined to Rs. 853 crore from Rs. 1,225 crore. Its consolidated revenues increased by 8 per cent to Rs. 7,082 crore from Rs. 6,559 crore. EPS worked out to negative Rs 1.57 as compared to Rs 3.19 in the last year. As against the equity capital of Rs. 1,193 crore, its reserves & surplus amounted to Rs. 5,580 crore. Its total borrowings went up by 36.8 per cent to Rs. 5,505 crore from Rs. 4,023 crore.  

Its Power Brands – Littles, Lacto Calamine, Polycrol, Tetmosol and I-range, grew by 37 per cent YoY in FY23 and contributed to 42 per cent of Indian Consumer Healthcare (ICH) division sales - E-commerce grew by more than 40 per cent YoY in FY23 and contributed 16 per cent to ICH revenues - Wide distribution reach across general trade outlets and organised retail stores. Also presence across all leading e-commerce platforms.
The sales of CDMO improved by 7 per cent to Rs. 4,016 crore from Rs. 3,752 crore in the previous year. The sales of complex hospital generics moved up 14.2 per cent to Rs. 2,286 crore and that of ICM increased by 6.6 per cent to Rs. 859 crore from Rs. 806 crore.  Capacity expansion in progress at Indian and US sites to meet growing demand for IA products. The company launched new 5 products and 3 SKUs in ICH business. High growth rate in power brands driven by sustained marketing and brand building efforts.
The board of directors of the Company has approved the issuance of equity shares of the company (the “Equity Shares”) for an amount not exceeding Rs. 1,050 crore by way of a rights issue to the eligible equity shareholders of the company as on the record date (to be determined and notified subsequently).

Draft Letter of Offer (DLoF) was filed on March 28, 2023 with Securities and Exchange Board of India. On December 20, 2021, the company had entered into agreements and acquired 27.78% stake in Yapan Bio Private Limited ('Yapan') for an investment of Rs. 101.77 crore. On April 4, 2022, the Company has acquired an additional stake of 5.55% in Yapan for an investment of Rs. 20.35 crore and thus the aggregate stake in Yapan is 33.33%.


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