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Lupin falls 9% as market punishes company for shocking loss and steep margin decline

Lupin falls 9% as market punishes company for shocking loss and steep margin decline

Lupin falls 9% as market punishes company for shocking loss and steep margin decline
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By Dipikka Ghosh  May 19, 2022 9:37:23 PM IST (Updated)

Shares of Lupin, on Thursday, fell as much as 9.21 percent to Rs 620.35 in early trade, touching a new 52-week low, as the Street expressed its disappointment on account of the company’s shocking loss and margin hit in its recently posted fourth quarterly numbers.

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Shares of Lupin, on Thursday, fell as much as 9.21 percent to Rs 620.35 in early trade, touching a new 52-week low, as the Street expressed its disappointment on account of the company’s shocking loss and margin hit in its recently posted fourth quarterly numbers.
At 10:30 am, the stock is trading at Rs 630, down 7.84 percent or Rs 53.60.
The shares of the company opened with a loss of 7.5 percent and has underperformed the sector by 6.97 percent.
Lupin intraday stock chart (source: BSE)
The company posted a loss of Rs 518 crore in the fourth quarter ended March. Investors were also disappointed by a magin decline of 1180 basis points (bps) to 6.9 percent on a year-on-year (YoY) basis.
The company’s US sales also came in below expectations as USD 181 million against USD 200 million in Q3FY22, registering a dip of 10.2 percent on a quarter-on-quarter (QoQ) basis.
“The current quarter was challenging with headwinds in the US on account of price erosion, and inflation in input materials and freight. Our other markets continue solid growth in revenues and profitability," said Nilesh Gupta, Managing Director of Lupin.
"We are focused on optimising operating expenses and spends, and ensuring the evolution of our complex generic platforms along with global portfolio maximization while doubling down on markets like India. We expect our efforts to yield meaningful uptick in profitability, especially in the second half of this fiscal and beyond,” he added.
In the past, Lupin’s management had guided for margin to stabilise at 14 percent and improve in FY23 and FY24 and US sales to maintain its current run rate.
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