Lupin Q2 Review - Operationally Disappointing, Reset Mode On, U.S. To Kick From FY23/24E: Dolat Capital

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Dolat Capital Report

Lupin Ltd. reported poor Q2 numbers operationally despite an in-line sales growth of Rs 4 billion, impacted by higher input costs, change in royalty/profit sharing clause and restructuring the U.S. specialty biz to reduce cash burn.

Company incurred multiple one-offs, which impacted margins (~150 basis points impact) at 15%.

Lupin reported net loss in Q2 owing to one time settlement for Glumetza of $250 million.

On the positive side, revenues in the U.S. at $184 million (up $12 million QoQ) and 16% YoY growth in India aided top-line.

Lupin seems to be in a reset mode where it is shedding the flab around the loss making specialty business in the U.S. and mitigating risk on its research and development programs via external funding.

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