During the fourth quarter of FY23, CSL recorded an impressive operating revenue of 58 Cr. However, in the subsequent first quarter of FY24, this figure experienced a reduction, amounting to 46 Cr. Although the company managed to maintain a commendable year-over-year revenue growth rate of 12.2%, it is noteworthy that the same metric reached an impressive 67% during the preceding Q4 FY23.
One of the pivotal growth drivers for Caplin has been its US business segment. Unfortunately, the current quarterâs performance in this domain has been considerably disappointing, failing to meet the expectations set by past successes. As a direct consequence, the response from the market has taken on a negative trajectory, reflecting the disappointment felt by stakeholders and investors alike.
Caplin point labs has produced good and consistent results in its journey and Q4 of last financial year was a great quarter, it is rare to find such companies who are consistently growing with great margins and their growth trajectory is very impressive. This Q1 results are not bad in any scrtech of imagination but it is the expectations that are naturally in the minds of investors that they wanted more and were disappointed with very good results when they expecting Great results!! I believe todays fall is just profit booking or some big players trying to create panic so they can accumulate more if public sells.
Some of Company capex plans are to be commissioned this financial year ( 4 projects ) one of them is the API facility in Vizag and other is that the company is adding a new line for which they have imported machine form Bosch which will start production around Oct-Nov this year
The growth is good, margins are good, almost zero debt, demand is good for which capex ongoing
Thanks for this Kamal, itâs very helpful. If I understand correctly, management claims that growth in Caplin Steriles in H2 will accelerate sufficiently to compensate for the low growth in Q1 and reach the stated target of 40-50% YoY growth? My calculation is that they need ~53% growth in the remainder of the year to achieve 45% full year growth.
While this seems achievable given last yearâs performance, it is important to note that they expect Phase 2 to come online only in Oct '23, meaning H2 will have to grow even faster depending on how Q2 goes.
@amat as per the managements commentary in the concall, the phase 2 completion is expected by Oct this year and they have got Hitech, state of the art machinery that they have imported from Germany ( Bosch ) and Italy that will improve the production multifold, the COO explained that the new 5th lineâs production capacity will exceed current 4 four lines combined production capacity!! So catching up with H1 numbers will not be that much of a challenge it is only the demand factor, inflation and political scenario that might poise a problem.
Hope this answers your query
The company repeatedly mentions to replicate the BOTTOM OF PYRAMID (BOP) STRATEGY which they have been using in LatM markets , in USA market. Not able to get clarity on it. What is it and How will it work?
What is a good expectation to build in for EBITDA MARGINS of Injectables to be sold in US?
From my understanding, BoP is a business strategy, which states a companies strategy to make profits by catering to those who are in the bottom of the pyramid, in Caplinâs case it would be providing low cost medications in economically weaker countries and lower income people.
I feel there is hardly any business that comes from Africa, nonetheless they keep saying Africa for sentimental reasons because they started their journey from Africa. But their core strategy has been to serve âBottom of Pyramidâ and that they want to do in US as well.
Another good news for Caplin point, Caplin sterile ltd ( Subsidiary) has received final approval by the United States Food and Drug Administration (USFDA) for the Abbreviated New Drug Application (ANDA) Norepinephrine Bitartrate Injection USP.
The final approval was received on 20th September 2023
Chennai, September 20, 2023: Caplin Steriles Limited (Caplin), a Subsidiary Company of Caplin Point Laboratories Limited (BSE: CAPPL (524742), NSE: CAPLIPOINT), has been granted final approval from the United States Food and Drug Administration (USFDA) for its Abbreviated New Drug Application (ANDA) Norepinephrine Bitartrate Injection USP, 4 mg/4 mL (1 mg/mL) Single-Dose Vial, a generic therapeutic equivalent version of (RLD), LEVOPHED
injection of Hospira Inc.
Norepinephrine Bitartrate Injection is used for restoration of blood pressure in adult patients with acute hypotensive states. According to IQVIATM (IMS Health), Norepinephrine Bitartrate Injection USP had US sales of approximately $40 million for the 12-month period ending June
2023.
Caplin Point Laboratories reported good results for Q1 FY24 with a 13.1% growth in revenue, 19.3% growth in EBITDA, and 20.8% growth in PBT compared to the same quarter last year.
The companyâs liquid assets stand at INR 1,540 crores, including INR 807 crores of cash and cash equivalents.
Expansion and Production Capacity:
Caplin Sterilesâ Phase 2 will become operational in October, increasing production capacity and boosting profitability.
Caplin Point is investing in API facilities for general and oncology APIs, with completion expected in six months and one year, respectively.
The company is expanding its presence in Latin America and has received a $4 million order for oncology products in the RoW market.
Market Focus:
The company is focusing on the US market and plans to establish a front-end presence there, which is expected to improve profitability.
Caplin Point is investing in R&D for injectables for the US market and has obtained 18 ANDAs.
Employee Engagement and Talent Retention:
The company is prioritizing employee engagement and is building a hostel for freshers, offering increments, performance bonuses, and attractive ESOPs to retain talent.
Long-Term Growth Strategy:
Caplin Point is focused on sustainable progress and long-term growth, with plans to become a vertically integrated company in the pharmaceutical formulations and API segments.
The company is investing in digitalization and automation to improve processes and increase efficiency.
Shareholder Rewards:
Caplin Point is considering inorganic growth opportunities and will discuss the possibility of rewarding shareholders through special dividends or buybacks.
Future Outlook:
The company expects strong growth in the next few years and aims to achieve its targets of top-line becoming bottom-line in the future.
