Ranbaxy's Q1 net profit up 7 percent, outlook bright

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For the March quarter, net profit rose to Rs.153 crore ($38.25 million) from Rs.142.70 crore ($35.67 million) for the corresponding period a year earlier, registering a year-on-year (YoY) growth of 7.21 percent.

During the same period, consolidated sales were Rs.1623.10 crore ($405.77 million), as against Rs.1564.40 crore ($391.1 million) a year earlier, registering a YoY growth of 3.75 percent.

The $4.7 billion-drugmaker, which hopes to be among the world's top five generic drugmakers with $5 billion in annual sales by 2012, said sales in North America grew 20 percent to $110 million in the March quarter from a year ago, while sales in Asia Pacific and CIS (excluding India) posted a rise of 30 percent to $56 million.

While sales in India saw a spurt of 17 percent to $85 million, sales in Europe registered a negative growth of 11 percent to $83 million.

As for the present fiscal year, Ranbaxy's CEO Malvinder Singh has forecast 20-25 percent profit growth and 18-20 percent revenue growth.

"Traditionally, the first quarter is always the weakest in terms of revenue. Revenue will only grow in the following quarters," Singh said.

"Following a good start to the year, we expect business to ramp up even further as we move through the successive quarters," he added.

Meanwhile, the drugmaker is reported to have increased its stake in Chennai-based Orchid Chemicals & Pharmaceuticals Ltd. to 14.7 percent. The two companies will work together in developing drugs and drug ingredients, Singh said, adding, "Orchid is a niche player in the global pharmaceutical industry with an impressive track record, particularly in sterile products. We are pleased to enter into this long term strategic alliance with them. The agreement will be mutually beneficial and synergistic, allowing both organizations to leverage each others inherent strengths. Orchid is a long-term strategic business alliance.''

Gurgaon-based Ranbaxy is among the world's top 10 generic drug producers and has grown internationally by selling generic drugs or by successfully challenging the drug patents held by western firms.

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