Cipla Earnings Preview: US business to aid revenue growth in the mid-teens

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Drugmaker Cipla is likely to report revenue growth in the mid-teens for the December quarter, led by a recovery in he US business.

A CNBC-TV18 poll expects net profit to jump 30 percent while EBITDA margin may expand by 150 basis points.

US sales for Cipla were at a multi-quarter high of $175 million in the September quarter. For the current quarter, US sales are estimated to be in the range of $190 million - $214 million compared to $150 million during the same period last year.

Growth in the US business is likely to be led by a ramp up of its inhaler albuterol and volume limited sales of cancer drug Revlimid generic and Lanotirade.

Cipla's domestic business is likely to grow between 5-6 percent year-on-year on account of a higher base due to sale of Covid-19 drugs.

EBITDA margin will improve by 150 basis points over the year-ago period due to better US sales.

Higher other income and better margin will also contribute to a 30 percent year-on-year growth in the company's net profit.

Cipla's Goa unit continues to be classified as Official Action Indicated (OAI) status by the USFDA, based on the latest communication it has received from the regulator.

The US drug regulator may continue to withhold product approvals from Cipla's Goa facility until the outstanding observations are resolved, the company said in an exchange filing.

Management commentary on US sales outlook, margin outlook, and a shift in manufacturing of key drugs like Abraxane generic and Advair generic launch will also be key.

Shares of Cipla have gained 19 percent over the last 12 months and are trading close to their 52-week high of Rs 1,185.