Mankind Pharma shares jump 9% post Q1 earnings. Should you buy?
Mankind Pharma jumped over 9% to the day's high of Rs 1,900 on the NSE in Thursday's trade following strong June quarter earnings and a favourable view by Macquarie. The Delhi-headquartered pharma major reported a sharp 66.4% year-on-year (YoY) rise in consolidated net profit for the quarter ended June 2023 to Rs 487 crore, with revenue rising 18.3% to Rs 2,579 crore. The operating profit, calculated as earnings before interest, taxes, depreciation and amortisation (EBITDA) for the quarter surged 43% YoY to Rs 660 crore, with margins expanding by a staggering 450 basis points to 25.6%.
The company’s pharmaceutical business outperformed the industry by 1.5x, on volume-led growth and the highest-ever chronic share. The domestic business reported a robust 14% YoY growth in the quarter. The secondary sales saw an impressive growth of 12.5%, thereby outperforming the industry by 1.5 times.
The company registered a volume growth of 4.3%, compared to the industry growth of 1.4%. Macquarie remains bullish on the prospects of Mankind Pharma and recommended an 'Outperform' rating on the counter. Commenting on its results, the brokerage said the April-June quarter earnings of Mankind posted yet another all-around beat.
The EBITDA beat was driven by the revenue beat, a better-than-expected gross margin, and operating leverage. “Our strategic initiatives across the businesses are delivering positive results, and we are hopeful that we will continue to outperform industry growth, going ahead,” Rajeev Juneja, vice-chairman and managing director said in a press statement. The company remains focused on differentiated filings, including in-licensing for key markets.
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