Cipla Q4 Results Preview: India, South Africa To Drive Growth As US Market Softens
In contrast to the US market, Cipla's India business is expected to exhibit strong growth, with projections of 9-10% year-on-year growth.
Cipla Ltd. is expected to announce its results on May 13. Brokerages are expecting the company to see challenges in US market, but see strong growth in India business.
The pharma company is expected to see a 9.7% rise in net profit to Rs 1,023.1 crore in the fourth quarter of fiscal 2025, according to a consensus estimate of analysts tracked by Bloomberg.
Cipla Q4 FY25 Results Estimates
Revenue expected to rise 8.7% at Rs 6,704.7 crore vs Rs 6,163 crore.
Ebitda to rise 18.25% to Rs 1,556.2 crore vs Rs 1,316 crore.
Ebitda margin at 23.2% vs 21%.
Net profit expected to rise 9.7% to Rs 1,023.1 crore vs Rs 932 crore.
US Market Challenges
In the United States, a key market for Cipla, brokerages anticipate a degree of moderation in sales, compared to the previous quarter. Several factors contribute to this:
Lanreotide Supply Constraints: Ongoing supply challenges related to Lanreotide, a crucial drug, have limited Cipla's ability to fully capitalise on market demand. While this issue is expected to be resolved by Q1 FY26, it has impacted near-term performance.
Weaker Respiratory Season: A less robust respiratory season in the US has also played a role in moderating sales growth.
Generic Revlimid Dynamics: While sales of generic Revlimid have been relatively stable, analysts foresee potential volatility in the coming quarters as competitive pressures intensify, particularly beyond FY26F.
India's Resilient Growth
In contrast to the US market, Cipla's India business is expected to exhibit strong growth, with projections of 9-10% year-on-year growth. This growth is fueled by:
A robust domestic market.
The strategic distribution agreement with Sanofi for Central Nervous System products, which has contributed significantly to the positive momentum. Even when excluding the impact of the Sanofi deal, the underlying growth in India remains healthy.
South Africa's Strong Performance
Cipla's South Africa business is another bright spot, with brokerages forecasting robust growth. This growth is attributed to:
The successful integration of the Actor Pharma acquisition, which has strengthened Cipla's position in the South African market.
A recovery in tender sales.
Ebitda margins, a key indicator of Cipla's profitability, are also under scrutiny. Brokerage estimates for Q4 FY25 vary slightly. For FY25, analysts project a healthy figure, aligning with management guidance of 25.5%. However, looking ahead for FY26, there are concerns about potential margin pressure due to factors such as increased competition in the generic Revlimid market and the possible impact of US tariffs.
Brokerages View
Centrum Broking
Key factors to watch out for:
Updated timeline on gAbraxane launch.
Update on resolving Lanreotide supply issue
Timeline of key launches (gAdvair, gSymbicort etc.)
Axis Securities
Factor in 9% top line growth in Q4, driven by continued strong growth
Momentum 20+% YoY growth in the South Africa and EU regions.
Expects 1% QoQ moderation in US sales to $223 million on weaker respiratory season.
Continued challenges in Lanreotide suppliers, despite a steady gRevlimid sales assumption.
Nomura
Higher US sales and tender in South Africa could negate seasonal weakness.
In FY26F, expects positive guidance on US launches, but a drop in Ebitda margin due to high FY25 base.
Systematix Institutional Research
US could surprise on Lanreotide recovery and Revlimid ramp up.
Domestic business could expand in the high single digit-low-double digit range.
