- 17 May 2024
- ICICI Securities
BIOCON Q4FY24 RESULTS- SOFT QUARTER WITH GROWTH IN BIOSIMILARS ONLY SOLACE
News: Revenues grew 4% YoY to Rs 3604 crore driven by Biosimilars which grew ~12% YoY to Rs 2358 crore. Research Services (Syngene) de-grew 8% YoY to Rs 917 crore, while Generic sales de-grew 3% to Rs 718 crore. EBITDA stood at Rs 916 core, a de-growth of 8% mainly due to higher employee expenses (Viatris integration) and other expenses even as R&D spend was significantly lower. EBITDA margins stood at 23.4% during the quarter (~300 bps lower).
Views: Although Biosimilars growth tapered down during the quarter, the company continues to gain market share in some important products across regulated markets. the back of new launches and market share gains. Syngene performance was weak because of the funding challenges in the US biotech space. Generics were softer due to significant price erosion in the API space but Formulations growth was strong. There was also pressure on margins due to higher employees and other expenses mainly on account of higher integration related overheads. Going ahead, launch momentum in the Biosimilars, Syngene’s revival, Formulation launches in Generics and outcome of critical plant inspections would be key things to watch out especially in the back-drop huge debt servicing.
Impact: Neutral