Cipla Q1 net dips 4% to Rs 686 cr, revenue down 2% on tapering Covid sales

Domestic revenue dips 8.4% as Covid-19 share of branded prescription business normalises; North American business up 10% to $155 million

Mumbai-based Cipla reported a post-tax profit of Rs 686.4 crore for the first quarter of fiscal 2022-23, down 3.96 per cent YoY, while its consolidated revenues shrunk 2 per cent to Rs 5,375 crore.

Cipla’s India revenue, consisting of trade generics, prescription business and consumer health, dipped 8.4 per cent YoY during the quarter, to Rs 2,483 crore. The company said this was due to normalisation in the share of Covid-19 drugs in the branded prescription business. Adjusted for Covid drugs, Cipla said its India business grew nine per cent, driven by core brands.

Umang Vohra, MD and Global CEO, Cipla, said the firm would continue to launch new brands in the domestic market, including generic Sitagliptin (for diabetes) and valsartan (for hypertension). He added that the company’s new focus therapy areas in India were dermatology, ophthalmology, women’s health and CNS (neurology).

Vohra told reporters that the growth in the India business would come from large brands, wellness portfolio, and growth in trade generics in the tier-2 to tier 6 cities etc.

Cipla's revenues from its North American business rose 10 per cent to $155 million, led by respiratory and peptide assets. Vohra said the firm soon expects to launch generic Advair, a molecule that now has 3-4 players.

“Our US run rate continues to witness consistent traction in respiratory, complex generics and peptide portfolio. We are closely tracking upcoming complex launches in H2FY23,” he said.

Vohra added: “Our reported operating profitability of 21.3 per cent is well within our full year guidance of 21-22 per cent range and has grown in double digits versus last year's base EBITDA, despite multiple cost headwinds. Our cost rigour and calibrated pricing actions have helped offset inflationary cost elements, insulate margins while maintaining high serviceability.”

Cipla is expecting more USFDA inspections in the coming six months that would be critical to its launch pipeline in the US.