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ICICI Securities Report
Lupin Ltd.'s Q1 FY21 performance was below our expectations mainly due to weak U.S. sales which declined 25.9% QoQ.
Consolidated revenues declined 9.0% to Rs 35.3 billion (our estimate Rs 36.9 billion) and Ebitda margin dropped 550 basis points YoY to 13.8% (flat QoQ), but came above our estimate of 13.0% despite weak U.S. sales.
We believe the U.S. business would gradually ramp-up with improving traction in Levothyroxine, launch of ProAir in September 2020 and approximately 15 new launches in FY21.
Additionally, cost control initiatives would aid margin improvement. We expect the revenue mix to improve going ahead with higher India and U.S. sales which would contribute approximately 73% to sales and approximately 75% to Ebitda.
The company would be providing Goa, Somerset and Pithampur facilities (all under Official Action Indicated status), to U.S. Food and Drug Administration for reinspection in next few months.
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