IndiaCatalog.com
India News
Search Web Directory
News Home
Cipla: India business reset and emerging market challenges crimp earnings expectations
Posted on 8th August 2019
Shares of pharmaceutical major Cipla Ltd lost about 3% leading the losses in the NSE Nifty stocks at Wednesday noon trade. The deceleration in India business came as a negative surprise. Revenues in India, the largest business market for Cipla, dropped 12% as the company re-aligned its distribution channel.

Data from pharmaceutical market research company AIOCD Pharmasofttech AWACS Pvt. Ltd did indicate a slowdown in Indian pharmaceutical market in April-June this year. But the slowdown is more pronounced at Cipla. “India business ex one-offs growth slowed to low single digit and was the key negative," Piyush Nahar, analyst at Jefferies India Pvt Ltd said in a note.

Revenues from other emerging markets dropped as well. The US business made-up for the loss of momentum in India and other emerging markets. Revenues in North America jumped 61% on scale-up on limited competition drugs.

Total revenues grew 1%. Better product mix and change in accounting norms helped the company report 25% rise in operating earnings.

Kedar Upadhye, chief financial officer of Cipla says the distribution realignment will have transitory impact and the business should return to the growth path from next quarter onwards.

But slowdown in India and challenges in global tender business, from which Cipla derives notable revenues, are making investors wary.

Further as the benefit from recently launched limited competition drugs fades in the US, growth in the country is expected moderate. “While current headwinds are expected to subside in coming quarters, a new headwind in the form of declining gSensipar sales will hit in Q2. We estimate gSensipar contributed ~$35million in Q4FY19 and Q1FY20. However, this is expected to decline significantly in Q2 due to increased competition and related price erosion. We estimate Q2FY20 revenue to reset to ~ $125million (US revenues stood at $161 million in Q1) due to absence of limited competition product launches in H1. The management expects further limited competition product launches only in H2," SBICAP Securities Ltd said in a note.

The revenue moderation in the US and challenges in emerging markets can soften Cipla’s profitability in near term, analysts fear. “Q1 will, in our view, mark the near-term peak in margins and EBITDA for Cipla. Going forward, lower gSensipar sales, higher R&D and continued impact on India and emerging markets will drive lower margins," Jefferies adds.

The concerns are crimping near term earnings expectations, even as the management expects the company to return to the growth path before the end of this calendar year on new products and India business stabilization.

Related Companies: Cipla Limited - Mumbai.   

Other Latest News
Dawood has provided logistical, financial support to Hafiz Saeed, reveals arrested gangster Ejaz Lakdawala
Posted on 22nd January 2020

Gangster Ejaz Lakdawala, arrested by Mumbai Police's anti-extortion cell on January 8, revealed crucial information about Dawood Ibrahim, saying that he provided logistical or financial support to Hafiz Saeed, according to sources quoted by Zee Media.

Lakdawala informed investigators that Pakistan Army's senior officers often visited his Karachi residence. From the officials, he learned that Dawood provided either logistical or financial support to Hafiz Saeed and others.


Delhi elections 2020: Worked like an elder son in family, says Kejriwal
Posted on 22nd January 2020

Delhi Chief Minister and AAP national convenor Arvind Kejriwal on Wednesday said his government did a lot for the people of the city in its five-year tenure but needed more time to complete the work pending for 70 years.

We have tried our best to give maximum benefit to the people of Delhi... to make their lives prosperous. We have made water and electricity free, improved the education and health care system.


Netflix subscriber forecast misses estimate as streaming war heats up
Posted on 22nd January 2020

Netflix Inc missed Wall Street subscriber forecasts for the first quarter Tuesday, amid pressure from lower-cost services from Walt Disney Co and Apple Inc in the streaming video wars.

The streaming giant added more paying subscribers than Wall Street expected in the fourth quarter, beating international subscriber estimates but missing estimates for U.S. subscriber growth.


Nifty CPSE index slips 3%; IOCL, Oil India hit 52-week lows
Posted on 22nd January 2020

Shares of Central Public Sector Enterprises (CPSEs) were under pressure with Nifty CPSE index falling 3 per cent on the National Stock Exchange (NSE) on Wednesday.

Oil and Natural Gas Corporation (ONGC), Oil India and Coal India dipped more than 4 per cent in the intra-day trade. NTPC, Bharat Electronics, Power Finance Corporation (PFC), NBCC, NLC India and Indian Oil Corporation (IOCL) were down in the range of 1 per cent to 3 per cent on the NSE.


'Token no. 45' Arvind Kejriwal files nomination as AAP candidate from New Delhi seat
Posted on 22nd January 2020

Delhi Chief Minister Arvind Kejriwal filed his papers from New Delhi assembly constituency seat on the last day of nomination, on Tuesday evening after being made to wait for hours.

The AAP chief was forced to wait in line to file his nomination as there were more than 40 candidates ahead of him who were at the Returning Officer's office to file papers.


» Post a FREE Classified Advertisement
Inviting Real Estate Agents, Job Placements Agents, Educational Institutes, Software Service Providers, Real Estate Builders, Marriage Bureaus, Travel Agents, Restaurant Owners, Health & Fitness Centers and other Local Businesses to Post a FREE Classified Advertisement on Cootera.com Classifieds Website.
Jobs in India India Real Estate Automobiles Matrimonials Beauty & Fitness

Add a comment for Cipla: India business reset and emerging market challenges crimp earnings expectations
Please only use this form to enter comments on the above company. All comments are reviewed before they are displayed on the web site. Not all comments may be displayed. Check back with us to see if your comments have been displayed.
If you want us to email the comments posted by users, please Subscribe by email
Name*
Comments*
Security Code*
 

Be the first person to write a business review for Cipla: India business reset and emerging market challenges crimp earnings expectations

Most Read News

HCL Tech falls 5% from day's high on profit booking post Q3 results

Citizenship Act: SC refuses to grant stay, gives Centre four weeks to reply

India ranks 76th on WEF's Social Mobility Index, Denmark tops the list

HDFC Bank slips over 1% as Q3 provisions rise; analysts maintain 'Buy'

Adani Enterprises denies wrongdoing in coal supply contracts case

More India News

  India Web Directory
Business Profiles
Automotive Directory
IT/ITES/BPO Directory
Hotel Directory
Health Directory
Business Directory
Gems & Jewellery
Education Directory
Real Estate Directory
Agriculture Directory
Logistics Directory
Yellow Pages
NRI Guide
Photo Galleries
Global Web Directory
*** FREE India Classifieds
Order Premium Listings
Submit a Site
Business Reviews
Home
About us
Link to us
Advertise
Contact us
Google Search Keywords: India Catalog, IndiaCatalog, India Web Directory
    © 1999 - 2020 IndiaCatalog.com
    All Rights Reserved
Privacy Statement