The shares of this large-cap compnay jumped around 2 percent after launching a generic formulation to treat ovarian cancer in the United States. The stock has delivered around 70 percent return to its shareholders on a YTD basis.
Price Movement:
With a market capitalization of Rs. 1,02,129 crores, the shares of Lupin Ltd started Friday’s trading session on a higher note at Rs. 2,234 compared to its previous close of Rs. 2,193.75.
During the trading session, the shares hit a high of Rs. 2,256.70, gaining around 2 percent, also recorded the company’s fresh 52-week and are currently trading at Rs. 2,239 apiece.
What Happened:
Such a positive movement in the share price was observed after the company announced that it has launched a generic cancer treatment drug, Doxorubicin Hydrochloride Liposome injection, in single-dose vials, in the US market.
This development follows the receipt of approval by ForDoz Pharma Corporation, USA (ForDoz), Lupin’s alliance partner, for its Abbreviated New Drug Application (ANDA) from the United States Food and Drug Administration (U.S. FDA).
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According to the company’s statement, the product is a generic version of Baxter Healthcare Corporation’s Doxil, which is indicated for the treatment of ovarian cancer, acquired immune deficiency syndrome (AIDS)-related to Kaposi’s Sarcoma, and multiple myeloma.
As per the Iqvia MATdata, Doxorubicin Hydrochloride Liposome injection had an estimated annual sales of USD 40.9 million in the US.
Financials:
Looking at the company’s financial statements, the revenue jumped by 13 percent from Rs. 4,961 crores during the March quarter to Rs. 5,600 crores in the June quarter. In addition, the net profits magnified by 119 percent from Rs. 368 crores to Rs. 806 crores during the same period.
Brokerage View:
Nomura, one of the international brokerage firms, recommended a ‘buy’ call on the counter and raised the target price with a target price of Rs. 2,427 indicating a potential upside movement of around 9 percent compared to its current market price.
The brokerage firm expects improved growth and profitability across key markets, which could position the company for a premium over peers.
Additionally, Nomura has also adjusted its projections to account for increased revenue contributions from Mirabegron in FY25 and Tolvaptan in FY26 and FY27, leading to upward revisions in EPS estimates of 28 percent for FY25 and 54 percent for FY26.
R&D and Future Outlook:
Lupin’s R&D expenditure is projected to be approximately Rs. 1,800 crores for FY25, concentrating on complex generics and new product development.
Additionally, the company plans to substantially boost R&D spending in Q2 and Q3 to further its pipeline. It will continue to focus on operational enhancements and compliance, supported by favourable FDA inspection outcomes for multiple facilities.
The company has a robust pipeline with approximately 20 new product launches planned for FY25, targeting a growth rate of 20 percent-30 percent.
Company Profile:
Headquartered in Mumbai, Lupin develops and commercializes a wide range of branded and generic formulations, biotechnology products, and APIs in over 100 markets in the U.S., India, South Africa, and across the Asia Pacific (APAC), Latin America (LATAM), Europe, and Middle East regions.
Written By Vaibhav Patil
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