(Reuters) – India’s Mankind Pharma reported a smaller-than-expected third-quarter profit on Thursday, hurt by a sharp rise in expenses.
Manforce condom and Prega News pregnancy kit maker reported a consolidated net profit of 3.8 billion rupees ($43.99 million) for the quarter ended Dec. 31. Analysts on average had expected a profit of 4.48 billion rupees, as per data compiled by LSEG.
Mankind said the $1.6 billion acquisition of Bharat Serums and Vaccines, effective October, also impacted the quarterly results, making them not comparable to the year-ago quarter. It had reported a profit of 4.54 billion rupees in the previous year.
Revenue rose 24%, in line with analysts’ expectations, driven by an increase in market share of its chronic illness drugs in India to 37.6% from 35.6%.
Total expenses rose 33% year-on-year as finance costs jumped to 2.21 billion rupees from 92 million rupees, while employee-related costs expanded 25%.
For further results highlights, click [Full Story]
KEY CONTEXT
Indian drugmakers such as Mankind Pharma have benefited from strong domestic demand for their specialty drugs and those used to treat chronic illnesses. New launches in the chronic drug segment have also driven growth in the last few quarters.
However, analysts at HDFC Securities in a note said that Mankind Pharma’s earnings in the quarter could be impacted due to costs from the acquisition and integration of Bharat Serums and Vaccines.
Peer Torrent Pharma will report third-quarter results on Friday.
PEER COMPARISION
Valuation (next 12 Estimates (next 12 Analysts’ sentiment
months) months)
RIC PE EV/EBI Price/Sa Revenue profit Mean # of Stock to Div
TDA les growth growth rating analysts price target yield
* ** (%)
Mankind Pharma Ltd MNKI.NS 42.66 25.29 6.99 21.59 13.48 BUY 15 0.89 NULL
Torrent TORP.NS 42.81 24.71 6.81 12.53 29.33 BUY 26 0.89 0.88
Pharmaceuticals Ltd
Glenmark GLEN.NS 24.80 14.58 NULL 11.42 64.85 BUY 10 0.87 0.17
Pharmaceuticals Ltd
Sun Pharmaceutical SUN.NS 33.46 25.02 6.30 10.33 15.89 BUY 32 0.88 0.75
Industries Ltd
* The mean of analysts’ ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
OCTOBER TO DECEMBER STOCK PERFORMANCE
($1 = 86.3830 Indian rupees)
(Reporting by Nishit Navin in Bengaluru; Editing by Vijay Kishore)
