Morepen Labs’ Net Profit rises by 256 per cent led by higher APIs exports

Morepen Laboratories Ltd. has reported a 256 per cent rise in its net profit (standalone) at Rs 8.41 crore in the first quarter (Q1) of FY 2019-20 as against Rs 2.36 crore net profit registered in the corresponding quarter of the previous fiscal. The company’s net sales revenue (standalone) in Q1 ’FY 2019-20 stood at Rs 186.70 crore showing a growth of 25.4 per cent vis-a-vis net sales revenue of Rs 148.83 crore in Q1 FY 2018-19. The company’s EBIDTA in Q1 FY 2019-20 increased by 67 per cent at Rs 19.73 crore and cash profit increased by 69.6 per cent at Rs 19.31 crore.

The company’s expanding export reach assisted in achieving a higher topline in Q1 FY 2019-20. Overall Export sales registered a growth of 49 per cent in Q1 at Rs 79.75 crore. Following a recent USFDA approval to its manufacturing facilities at Baddi and Masulkhana, the Company began exports of its bulk drug Montelukast Sodium to the US and other regulated markets of the world in Q1’FY 2019-20. Export sales in Q1’FY 2019-20 for Montelukast Sodium rose by 210 per cent and that of Atorvastatin Calcium by 57 per cent vis-a-vis the corresponding quarter of the previous fiscal.

This was disclosed by Sushil Suri, Chairman and Managing Director, Morepen Laboratories, after the Q1 (FY19-20) results board meeting recently. “With a focus on new molecules, new patented processes and accreditation of our in-house R&D Centre at Baddi (Himachal Pradesh) from the Department of Scientific and Industrial Research, New Delhi, we now look forward towards investing more in our R&D Infrastructure for future growth of the company,” Suri said.

The bulk drugs (API) segment contributed marginally over 60 per cent to the company’s total turnover in Q1 FY 2019-20. API exports grew by 50 per cent with Montelukast registering 210 per cent growth at Rs 25.22 crore, Atorvastatin 57 per cent growth at Rs16.29 crore and New Molecules registering 346 per cent growth at Rs 5.96 crore. Major API exports in the quarter were done to APAC (Asia Pacific) markets accounting for around 58 per cent of the total API exports, followed by the US and European markets (around 36 per cent) and other semi-regulated markets (around six per cent). While APAC business grew by 79 per cent, the USA business registered a growth of 37 per cent, European business (four per cent) and business from other semi-regulated markets (two per cent).

Morepen’s domestic API business grew by 33 per cent in the quarter at Rs 32.91 crore with Rosuvastatin and Atorvastatin registering a growth of 262 per cent each, followed by Loratadine (28 per cent).

The overall Home Diagnostic Segment recorded total quarterly sales at Rs 40.03 crore in Q1 FY 2019-20, registering a rise of 16 per cent vis-a-vis corresponding quarter of the previous fiscal. Blood Glucose Monitors and Nebulisers recorded the highest growth in the quarter at 30 per cent and 118 per cent, respectively. The combined sales revenue of Blood Glucose Monitors and Blood Pressure Monitors in the quarter increased to Rs 37.45 crore as compared to Rs 31.51 crore in the corresponding quarter of previous fiscal, registering a growth of 19 per cent. Looking at increasing incidence of diabetic cases in India, the Blood Glucose Monitors and Blood Pressure Monitors segment offers great opportunity for growth in the coming years. In all, around 325 million glucometer strips have been sold by the company till date and Blood Glucose Monitors installations have crossed the three million target.

Overall, finished dosages business did not perform well in this quarter due to general slowdown and competitive pressures. This business declined by around six per cent in Q1’FY2019-20. Sales from Branded Prescription (Rx) products in the quarter went up by 25 per cent with major contribution coming from main brands like Saltum, Rhythmix, Acifix, Klarim and Cefopen. Branded generics has de-grown by 15 per cent during the quarter due to general slowdown in the industry coupled with increased competitive pressure.

Morepen Labs’ pharma division also commenced commercial sales of its probiotics in India during the quarter under consideration. The company has launched new generation probiotics (Brand: Intebact) in the domestic market which has, so far, received very good response from target customers. Of late, Morepen had tied up with Vesale Pharma of Belgium to launch latter’s complete range of probiotics in the Indian market.