The shares of Cipla rocketed almost 10 per cent on the NSE (National Stock Exchange) after pharmaceutical titan's goa manufacturing facility was classified as 'Voluntary Action Indicated' (VAI) by US Food and Drug Administration.
What is 'VAI' designation by US FDA
A pharmaceutical manufacturing facility is inspected before receiving the USFDA's VAI classification. While the FDA found some problems during the inspection, it means that they are not serious enough to warrant formal enforcement action.
In order to proceed with product approvals or other regulatory procedures without hindrance, the company is expected to voluntarily rectify these minor shortcomings.
Stock performance
The stock hit the day high level of Rs 1,560.05 per share on the NSE (National Stock Exchange) after hitting the opening bell on the same level as the day high on the Indian bourses.
The shares of Cipla were trading at Rs 1,534.25 per share on the NSE (National Stock Exchange), with a surge of 8.18 per cent amounting to Rs 116.00 per share.
Cipla Q2 FY25
Cipla announced its consolidated net profit for the quarter ending in September 2024 increased by 15.2 per cent to Rs 1303.53 crore, compared to the net profit of Rs 1131 crore recorded in the same quarter last year.
Compared to the Rs 6678 crore reported in the same quarter last year, its operating revenue for the July to September 2024 quarter increased 6 per cent YoY to Rs 7051 crore.
EBITDA Q2 FY25
PAT grew by 10.6 per cent sequentially, while operating revenue increased by 5.1 per cent. Earnings before interest, tax, depreciation, and amortization, or EBITDA, increased 10.7 per cent year over year to Rs 2,076 crore.
Indian busines growth
The slow market affected performance in anti-infectives, one of Cipla's biggest therapies, causing the Indian branded prescription business to grow by 5 per cent instead of 12 per cent.
The acute category's slow growth was another effect of seasonality on the trade business. It is anticipated that this company will resume its growth trajectory in the next quarters.
The Consumer Health segment exhibited a 21 per cent year-over-year increase, with leading brands like Cipladine, Nicotex, and Omnigel continuing to hold their positions.
Total R&D Capex
Spending on research and development totaled Rs 385 crore, amounting to 5.5 per cent of sales, a 2 per cent year-over-year increase. The company reported a healthy net cash balance of Rs 7,950 crore, with working capital requirements and lease liabilities accounting for the majority of its debt.
