Pharma companies likely to post 15% profit growth in Q3 FY'14

Tags: News
Pharmaceutical companies are expected to post core profit growth of over 15 per cent, year-on-year, for the quarter ended December 2013.

"We expect core profit growth of over 15 per cent y-o-y across the pharmaceutical sector in Q3 FY'14. The US launches and currency benefit to be the key growth drivers," Kotak Institutional Equities said in its report.

While the domestic growth stays subdued, the US launches remain strong, it said. It expects the US generic launches to be the key growth driver, offsetting weak growth in India.

The improving US product mix and currency remain key margin drivers for Indian generics, according to the report.

"The currency benefit is likely to sustain. In the current quarter, The Indian rupee has appreciated by 1 per cent sequentially on a quarter-end basis. Hence, we expect marginal impact due to translation impact of net balance-sheet items and MTM losses on foreign currency hedges," said Kotak Equities research analyst Krishna Prasad.

Among the leading pharma players, Sun Pharma and Dr Reddy's will lead the sector, while Lupin US generics growth is expected to remain strong, it said, adding that Kotak expects a stable growth for Glenmark and remains conservative on recovery in Cipla and Cadila in the third quarter of the 2013-14 fiscal (Q3 FY'14), the report said.

"We expect core profit growth of over 15 per cent yoy across the sector except Cipla. Sun Pharma and Dr Reddy's will lead the pack--with 45 per cent and 33 per cent yoy net profit growth, respectively. In both cases, we expect US generics to be the primary growth driver along with currency," Prasad said.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Amit Shah deserved to be crowned President of India, some say

    The Bharatiya Janata Party is now firmly in the hands of Modi’s alter ego, which in plain English means ‘another side of oneself, a second self’

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Arun Nigavekar

Necessary yet inadequate boost to education

The finance minister, in the very first minutes of his ...

Zehra Naqvi

We must overcome the fear of death

It is the biggest irony that the only thing that’s ...

Dharmendra Khandal

Jawai leopards and locals can coexist peacefully

At first glance, the Jawai landscape seems like a large ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture