- 21 Oct 2022
- ICICIdirect Research
High paracetamol sales drive growth, margins improvingGRANULES - 285 Change: 2.75 (0.97 %)
Revenues grew 29.5% YoY to Rs 1150.7 crore, driven by YoY growth of 73.4% in API to Rs 330 crore and 22.9% growth in PFI to Rs 234.9 crore. Formulations grew 15.6% YoY to Rs 585 crore. EBITDA margins grew 409 bps YoY to 21.1 %. EBITDA grew 60.7% YoY to Rs 243 crore and PAT grew 79.9% YoY to Rs 145 crore.
Granules revenues growth in this quarter has beaten our estimates mainly driven by higher paracetamol sales in the US, increased market shares and new launches. Contribution of the revenue by paracetamol increased 46.8% as compared to 33% in Q2FY22, API sales contribution also increased to 29% versus 21% in Q2FY22. EBITDA margins were better than our estimates and are recovering (up 36 bps QoQ) on account of higher sales and company reduced R&D expense to 2.1 % of the revenue vis-à-vis 3.1% in Q1FY23. Granules remains a decent player with clear vision to play on its strength of economies of scale and gradual expansion into more complex products/forms to improve margins.