Gland Pharma Q4 Results Preview: US Pick Up, New Launches, Cenexi Recovery To Offset Seasonal Weakness

Gland Pharma Ltd. is set to announce its financial results for the January–March quarter on Tuesday. Brokerages expect the firm to deliver a stable fourth quarter performance, supported by shipment deferrals, new launches, and a gradual recovery in its overseas businesses.

While the fourth quarter is seasonally weak for pharmaceuticals, this time the impact may be limited due to strong US business momentum—particularly from gRevlimid—and a rising share of chronic therapies in the domestic segment.

Cenexi's revenue is also likely to show a modest sequential uptick, aided by resumption of supplies post scheduled maintenance. However, concerns remain around tariff-related risks and potential margin pressure. Investors will closely track updates on China expansion, complex product pipeline, and strategic direction under the new CEO.

As per Bloomberg estimates, Gland Pharma’s consolidated revenue for the March quarter is expected to rise 0.9% year-on-year to Rs 1,551.73 crore, compared to Rs 1,537.45 crore a year ago.

Ebitda is likely to rise 49.59% to Rs 376.14 crore from Rs 356.39 crore, while margin is expected to expand to 24.2% from 23.3% a year ago. Net profit is seen rising to Rs 233.36 crore for the quarter from Rs 192.42 crore.

• Revenue seen 0.9% higher at Rs 1,551.73 crore versus Rs 1,537.45 crore.

• Ebitda seen 5.54% higher at Rs 376.14 crore versus Rs 356.39 crore.

• Margin seen at 24.2% versus 23.3%.

• Profit rises 21.28% to Rs 233.36 crore versus Rs 192.42 crore.

BofA | Target Price: Rs 1,393.75

• Tariff-related uncertainty continues to influence stock performance for US-focused pharmaceutical firms in the near term.

• A 10% tariff is already priced in, in BofA’s view, but any increase in the rate or tariffs based on the source of API remains a key risk.

• In the upcoming earnings season, BofA expects sequential growth in US sales for its coverage universe in fourth quarter, aided by lumpiness in gRevlimid revenues.

• However, industry data points to muted growth in India for most companies, with the exception of Sun Pharma and Torrent Pharma.

• Hospital companies are likely to benefit from seasonal strength, while export data suggests a quarter-on-quarter improvement in sales for Divi’s Laboratories.

• BofA’s price objective is Rs 2,020 per share, based on a 22.2 times FY27E PE multiple, which aligns with long-term averages for US generics-focused peers.

• Gland Pharma’s stronger margins (excluding Cenexi), limited reliance on new launches, and scale/cost advantages make it relatively better positioned than pure-play US generics firms.

• Current forecasts do not include potential upside from Gland’s entry into biosimilars, GLP-1s, CDMO work with large pharma clients, or growth in the China market—each considered upside risks.

• Key downside risks include slower-than-expected US sales growth, potential partner exits, rising competition in pipeline products, quality concerns stemming from future inspections and delayed recovery pace at Cenexi.

Nomura | Rating: Neutral | Target Price: Rs 1,585

• Cenexi’s sales are expected to remain flat quarter-on-quarter, impacted by regulatory observations at the Fontenay site (which contributes ~40% of revenue) and a breakdown of the lyophiliser line at the Belgium site.

• These operational issues at Cenexi are likely to be resolved by the first half of financial year 2026F.

• A marginal increase in US sales (excluding Cenexi) is anticipated quarter-on-quarter.

• Key aspects to watch include the strategic direction under the new CEO, recovery in US sales during fiscal 2026F, and management guidance on Cenexi’s revenue and financial year 2026F Ebitda.

IIFL Capital | Rating: Add | Target Price: Rs 1,650

• Gland Pharma’s India business is largely B2B, according to IIFL Capital.

• Quarter-on-quarter growth is expected to be supported by shipment deferrals of key products like Enoxaparin and Ketorolac from third quarter to fourth quarter.

• This growth will be further complemented by a ramp-up in new launches and stable price erosion.

• Cenexi’s revenue is forecast to grow by 6% quarter-on-quarter, rising from EUR 41 million to EUR 44 million in fourth quarter.

• Revenue excluding Cenexi is projected to grow 16% quarter-on-quarter.

• Saudi tender offtake is expected to support growth in RoW (excluding Cenexi) during fourth quarter.

• Cenexi is expected to report an Ebitda loss of 7.2% in fourth quarter versus an 8.4% loss in third quarter.

• Ebitda margins for Gland Pharma’s base business (excluding Cenexi) are assumed to fall to 34.4% in fourth quarter, from 38.6% in third quarter, due to resumption of low-margin Enoxaparin supplies and the Saudi contract.

• Under a hypothetical 26% tariff scenario for the pharma sector, with 50% pass-through to channels/patients, Gland could face Ebitda cuts of 12–22% for financial year 2027.

• While a 16% quarter-on-quarter revenue growth (ex-Cenexi) is modelled for fourth quarter, Jan–Feb 2025 export shipment data shows a 10% quarter-on-quarter decline, implying downside risk to these estimates.

Equirus | Rating: Short | Target Price: Rs 1,138

• Historically, fourth quarter has been a weak quarter for the pharmaceutical sector due to seasonal softness in the domestic business.

• This year, the impact is expected to be minimal owing to strong performance in the US business, supported by a pick-up in gRevlimid revenues.

• The domestic business is also seeing a rising share of chronic therapies, which is likely to cushion seasonal weakness.

• USD appreciation is another factor supporting overall performance in fourth quarter.

• Resumption of Cenexi supplies after scheduled maintenance is expected to aid sequential growth.

• Key areas to monitor include updates on expansion in China and timelines for complex product launches.