Piramal Pharma shares rise 8% after Q2 results

Shares of Piramal Pharma rose as much as 8% to hit an intraday high of ₹100.30 apiece on the BSE after the company reported a consolidated net profit of ₹5 crore in the July to September quarter of FY24. The company had reported a loss of ₹37 crore in the same period last year. The company also witnessed an 11% year-on-year increase in revenue from operations to ₹1,911 crore during the quarter under review, as against ₹1,720 crore in the same period last year. The company attributes broad base performance across all three businesses i.e. contract development and manufacturing (CDMO), complex hospital generic and India consumer healthcare to be the reason behind this.

The scrip opened at ₹99.70 on Monday, up 7.72%, as against the previous closing price of ₹92.55. At the time of reporting, the share price of Piramal Pharma was trading 3.57% higher at ₹95.85. During the session on Monday, the company’s market capitalisation stood at ₹12,687.07 crore with more than 13.61 lakh shares exchanging hands on the BSE, as against the two-week average of 3.40 lakh shares. The company touched a 52-week high of ₹174.83 on November 3 last year, whereas a 52-week low of ₹61.68 on March 28 this year.

During the quarter under review, the company’s EBITDA (earnings before interest, tax, depreciation and amortisation) stood at ₹315 crore, witnessing a growth of 44% YoY as against ₹219 crore in the same period last year. The company attributes revenue growth and cost optimization measures to be the reason behind the growth in EBITDA. The company’s EBITDA margin improved to 16% in September quarter as against 13% in the same period last year primarily driven by operating leverage and cost optimization & operational excellence initiatives.  

"We have delivered a healthy performance in the first half of the financial year with 14% revenue growth accompanied by over 300 bps improvement in EBITDA margin. Our CDMO business returned to mid-teen growth with continued order inflows, especially for differentiated offerings and innovation related work. Our capacity expansion for inhalation anesthesia products is progressing well as we look to capitalize on the healthy demand in the global market. Our India Consumer Healthcare business is delivering steady growth driven by our power brands. Historically our H2 has been better than H1, both in terms of revenue and profitability. We expect similar trend to play out this financial year as well, more specifically in Q4," says Nandini Piramal, chairperson, Piramal Pharma Limited.

In the September quarter, the company completed the rights issue of ₹1,050Cr with subscription of 128%. The company’s net debt as on September 30, 2023 is ₹3,823 crore, witnessing a reduction of ₹958 crore since 31st March 2023. The company aims to reduce greenhouse gases emission by 42% by FY30.