Torrent Pharma shares hit 52-week high; here's why

Shares of Torrent Pharmaceuticals Ltd, surged as much as 3.1% to hit a 52-week high of ₹2,745.55 apiece on the BSE after the successful inspection by the U S. Food and Drug Administration (USFDA) at the company's plant in Gujarat.

"The USFDA has issued an Establishment Inspection Report (“EIR”) for the said manufacturing facility and the inspection has now been successfully closed by the USFDA," says the company in a regulatory filing.

The USFDA conducted the pre-approval inspection at the company’s oral-oncology manufacturing facility situated in Bileshwarpura, Gujarat from December 5 to December 11 last year.

Following this announcement, the share price of the pharmaceutical major opened higher at ₹2,670.30, up 0.3%, as against the previous closing price of ₹2,662.20.

The company hit a 52-week low of ₹1,486 on March 10 last year. The company’s market capitalisation stood at ₹89,761.85 crore with 9,974 shares exchanging hands on the BSE, as against the two-week average of 2,367 shares.

At 12:48 pm, the share price of the company was trading 0.37% lower at ₹2,652.30. This was in line with the broader BSE Sensex, which was trading 0.26% or 191.09 points at 73,486.04.

In the past one month, three months and a year, the share price of Torrent Pharma has given 1.63%, 27.66% and 76.84%, respectively, in returns. In the year-to-date period, the share price of the pharmaceutical company has given 15.63% in returns.

In the October to December quarter of FY24, the company reported a 52% year-on-year (YoY) increase in net profit to ₹443 crore driven by a strong demand in the domestic market, Brazil and Germany. The company’s net profit in the December quarter of FY23 stood at ₹292 crore. The company’s revenue from operations grew 10% year-on-year (YoY) to ₹2,732 crore in the December quarter of the current fiscal, as against ₹2,491 crore in the Q3 of FY23. Of this, the revenue from the domestic market contributed to 12% of the company’s overall revenue standing at ₹1,415 crore.

The company's earnings before interest, tax, depreciation and amortisation (EBITDA) also witnessed a growth of 20% YoY to ₹869 crore. The spending for research and development increased by 3% YoY to ₹127 crore in the December quarter.

According to analysts at BN Paribas, the company's domestic business is likely to outperform in the coming quarters. "The rest of the year will focus on improving market share in focused therapies, new launch performance and enhancing field force productivity of the expanded divisions," says analysts.