Tag: Alkem Labs

CNBC-TV18 accesses details of 10 observations issued to Baddi unit of Alkem Labs by USFDA

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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CNBC-TV18 has accessed the ten observations issued by the United States Food and Drug Administration (USFDA) to the Baddi unit of Alkem Laboratories Ltd. last month. The observations range from drug product containers to control procedures.

The US drug regulator had inspected the Baddi facility of Alkem Laboratories between March 19 to March 27, post which it had issued a form 483 along with the 10 observations.

Here are the 10 observations issued by the USFDA:

• Failure to thoroughly review any unexplained discrepancy
• Responsibilities and procedures applicable to quality control unit not in writing and not fully followed
• Separate or defined areas to prevent contamination or mix ups are deficient
• Equipment and utensils are not cleaned, maintained or sanitised
• Appropriate controls governing computer acquired data and / or related systems not established
• Failure to handle and store drug product containers at all times
• Control procedures not established
• Lab controls do not include establishment of scientifically and sound appropriate specifications
• Reserve samples from representative samples or batches lots or batches not examined visually

The inspection was both a Good Manufacturing Practices and a pre-approved inspection.

In response to the findings, Alkem Laboratories stated that this inspection is a part of routine business operations. The company has committed to submitting a detailed response to the USFDA within the stipulated timeline and closing out the observations.

Shares of Alkem Laboratories are trading 0.5% higher at ₹4,855.90. The stock is gained 44% in the last 12 months.

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Alkem Labs gains over 5% on retaining FY24 India growth guidance

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Alkem Laboratories shares jumped more than 5% on Wednesday in morning deals despite mixed views of analysts following strong results for the September quarter (Q2FY24).

The stock jumped as much as 5.54% to touch a high of ₹4,250 per share on BSE a day after the company reported a strong 77% rise in consolidated net profit for the July-September period.

The stock trades nearly 1% down from the 52-week high of ₹4,270.95 hit on August 10 this year.

Alkem Labs also retained its high-single-digit growth guidance for India in FY24. It reported a revenue growth of 11% to ₹ 3,440.17 crore for the September quarter of FY24 compared to ₹3,079.37 crore in the year-ago period.

Mumbai based Alkem Labs, which manufactures and sells pharmaceutical generics, formulations and nutraceuticals, also marginally raised margin guidance for FY24 to 16.5% from 16% earlier.

Following the results, global brokerage Nomura upgraded the stock to ‘buy’ rating with a target price of ₹4,963 per share, implying a potential upside of 23% in the next 12 months.

Also Read: Multibagger stock: Cochin Shipyard shares rise 100% in 2023, Kotak upgrades stock to ‘Reduce’

Nomura mentioned that the Q2 results were ahead of estimates and earnings were supported by lower cost, and tax rate.

It also stated the company’s intent to pursue acquisition is “positive”.

However, another brokerage Macquarie was bearish on Alkem Labs as it expects the company’s Q4 numbers to remain weak due to adverse seasonality.

Macquarie assigned Underperform rating on Alkem Labs with a target price of ₹3,175 per share, implying a potential downside of 21% from Tuesday’s close.

“EBITDA margin guidance raised to 16%+ from 16% earlier,” the brokerage noted.

Alkem Laboratories has posted a 76.83% year-on-year jump in consolidated net profit to Rs 614.89 crore in Q2FY24 driven by lower raw material cost and lower intensity of price erosion in the US market.

Alkem Labs shares traded 4.55% higher at ₹4210 apiece on BSE at 9.37 AM.

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Alkem Labs Share Price: Stock is the top Midcap loser after domestic business guidance cut for FY24

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Shares of Alkem Laboratories Ltd. plunged as much as 7.5 percent on Friday after brokerages downgraded the stock post its June quarter results.

The company lowered its domestic business growth guidance for financial year 2024 to high single digits from low double digits earlier. However, it retained its 16 percent EBITDA margin guidance for the current financial year. It also expects EBITDA margin to expand 50-100 basis points every year post financial year 2024.

Global investment bank HSBC downgraded Alkem Labs to ‘Hold’ with a price target of Rs 3,945. It said that the India segment (65 percent of June quarter sales) grew slower than the market as delayed monsoon impacted sales of acute therapies.

Strong volume pick-up in the India segment will be a key catalyst going ahead, noted HSBC.

Bank of America (BoFA) also gave an ‘Underperform’ rating to Alkem Labs stock with a price target of Rs 3,500.

It said that the June quarter was an in-line quarter for Alkem, but consensus cuts are likely on the lower India growth guidance by the company. “Muted India growth is likely to overshadow international and gross margin beat,” BoFA said.

BoFA further said that the Alkem’s India growth does pose a risk for financial year 2024’s growth and margins.

Nomura remains neutral on Alkem Labs with a price target of Rs 3,632. It said that while the company saw higher-than-expected international sales, gross margins were negated by slower domestic growth, high expenses and high tax rate.

Shares of Alkem Labs are trading 7 percent lower at Rs 3,858.20. The stock is the biggest loser on the Nifty Midcap index. Out of the 26 analysts that track Alkem Labs, nine each have a buy and hold recommendation, while eight have a sell rating.

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USFDA concludes inspection at Alkem Lab’s Ankleshwar facility with zero observations

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Pharma company Alkem Laboratories has said that the United States Food and Drug Administration (USFDA) has completed the inspection of its manufacturing facility in Ankleshwar, Gujarat, with zero observation.

The US drug regulator had conducted a GMP (Good Manufacturing Practice) and pre-approval inspection at the facility from April 3 to April 7. After the end of the inspection, no Form 483 was issued, Alkem said in a filing to the stock exchanges on Friday.

According to USFDA, Form 483 is issued to a company after the conclusion of an inspection when the investigator observes that any food, drug and device has been adulterated or held under conditions whereby it may become injurious to health.

In February, Alkem Laboratories announced that the USFDA concluded its inspection at the company’s Indore facility.

The federal agency of the Department of Health and Human Service had issued an Establishment Inspection Report (EIR) for the company’s manufacturing unit, which was inspected between July 1-7, 2022.

During the inspection, Alkem Laboratories was issued Form 483 containing only one observation.

Founded in 1973, Alkem Laboratories has 21 manufacturing facilities at multiple locations in India and the United States of America. About 29 percent of its revenue is generated via offshore sales

Shares of Alkem Laboratories are off the day’s high, currently trading little changed at Rs 3,402.50.

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Alkem Labs posts 13% drop in Dec quarter net profit at Rs 454.7 crore

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Drug maker Alkem Laboratories Ltd reported 13.5 percent drop in net profit at Rs 454.7 crore for the December quarter as against Rs 525 crore a year ago. However,  the company’s latest quarter net profit was 9.2 percent higher than Street estimates of Rs 416.4 crore.

Its revenue of Rs 3,040 crore was 16.1 percent higher than the year ago quarter and 2.2 percent more than Street estimates. In the third quarter of last fiscal, the pharma company reported a revenue of Rs 2,619 crore and the CNBC-TV18 poll had estimated the same to come in at Rs 2,976 crore for this year’s Q3.

Alkem Labs reported its earnings before interest, taxes, depreciation, and amortisation (EBITDA) at Rs 599.1 percent, which was 34.7 percent higher than the CNBC-TV18 poll estimate of Rs 444.7 crore. Its margin was 19.7 percent for the December quarter, close to last year’s 19 percent.

In the third quarter last fiscal, it reported an EBITDA of Rs 498.4 crore.

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Alkem Labs gets US FDA nod for chest pain drug; Shares rise

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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[wealthdesk shortname=”Alkem Lab” isinid=”INE540L01014″ bseid=”539523″ nseid=”ALKEM” sector=”Pharmaceuticals” exchange=”nse”]

Alkem Laboratories Ltd received approval from the United States Food and Drug Administration (FDA) to manufacture a key drug used to treat chest pain.

The drug, known as Nifedipine, is used in the treatment of high blood pressure, and to control angina or chest pain. CNBC Awaaz reported on Tuesday about Alkem Laboratories getting the FDA’s approval to manufacture Nifedipine.

Alkem Laboratories recently received approval from the Drug Controller General of India (DCGI) to launch StemOne in India. The product is used in the treatment of knee osteoarthritis and is the first allogenic cell therapy product approved for commercial use in India.

Brokerages are bullish on Alkem Laboratories but have sounded cautious regarding the company’s valuations. The company’s June quarter results missed street expectations, post which, ICICI Securities cut its price target lower to Rs 3,695 from Rs 3,916 earlier.

Shares of Alkem Laboratories recovered from the day’s low and are trading 1 percent higher at Rs 3,204.80 on the National Stock Exchange. The stock is down 12 percent year-to-date.

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HDFC Securities’ Dipen Sheth is upbeat on these two auto stocks

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Dipen Sheth, head of institutional research at HDFC Securities, spoke to CNBC-TV18 about the auto sector and shared growth outlook.

Talking about the auto space, Sheth said, “Optimist believes it is a cyclical slowdown, while the pessimist would like to believe it is structural one but the jury is still out on that.”

According to him, “A little of stronger than anticipated pullback is okay and that need not be a cause of too much worry. A lot of things are affection the auto demand. The commercial vehicle demand has been hit by slowing IIP, axel loading–norm, BS-VI transition while passenger car growth is facing issued due to rise in cab aggregators, plus driving difficulties. Meanwhile, two-wheelers have been impacted due to rural consumption going through rough weather.”

“Most original equipment manufacturers (OEMs) have high RoC businesses and should be able to weather this,” he said.

“We would be confident buying Maruti with a long-term horizon, while the top pick in the space is Hero MotoCorp,” said Sheth.

When asked about Yes Bank, he said, “We don’t have it under coverage for years now. We stayed clear of it when we could not figure out how stuff added up. We suspect it has begun to add up and add up massively now. However, the new management is conscious of what could have gone wrong and how to put it together.”

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Alkem Labs a good buying opportunity, says Motilal Oswal

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Alkem Laboratories market price has been corrected in the last 6 months, thus providing a good buying opportunity, Motilal Oswal said, in its research report.

The brokerage reiterates ‘buy’ on Alkem Laboratories at a price target of Rs 2,170 per share with an upside of 22 percent.

The brokerage said, “With compliance in place and ANDA filings/approvals proceeding at a healthy rate, expect the mid-cap pharmaceutical company to post revenue CAGR of 16 percent over FY19-21E and improve profitability from US generics.”

It also added, “The domestic formulation segment will deliver 14 percent CAGR over FY19-21E due to the higher number of manufacturers (MRs) focusing in chronic therapies, adjustment of few products and the ongoing momentum in the trade generics.”

Furthermore, Motilal Oswal reduces Alkem’s P/E multiple to 22x from 24x to factor in US generics’ headwinds and the gradual growth downtrend in the DF industry growth.

Alkem’s M9FY19 performance was subdued (3 percent YoY decline in earnings) due to the course correction and weak season in the DF business. However, the brokerage remains positive on Alkem due to its superior execution in domestic and US generics, thereby driving 23 percent earnings CAGR over FY19-21E, added the report.

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow

Top brokerage calls for Friday: Kotak downgrades Maruti Suzuki, DB positive on UPL, Gujarat Gas

KV Prasad Jun 13, 2022, 06:35 AM IST (Published)

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Indian shares are likely to remain negative following Asian markets, which shuddered lower on Friday after the European Central Bank slashed its growth forecasts, leaving investors fearing the worst for the global economy.

On Wednesday, the Nifty50 closed at 11,058, up 5 points, and the BSE Sensex climbed 89 points to close at 36,725.

Kotak Institutional Equities downgraded Maruti Suzuki and cut its target to Rs 7,500 from Rs 7,600. Meanwhile, Nomura maintained a neutral call for ALkem Labs but cut its target price. Deutsche Bank, however, was positive on UPL and Gujarat Gas.

Here are the top brokerage calls for today:

Kotak Institutional Equities on Maruti Suzuki

– Downgraded to add from buy, target cut to Rs 7,500 From Rs 7,600 per share

– Domestic passenger vehicle industry is likely to grow in low single-digit

– Expect the company to gain market share, but cut its earnings per share (EPS) estimates by 4-9 percent for FY19-21

– Company to gain 290 bps market share over the next four years

Nomura on Alkem Labs

– Remain neutral call, target cut to Rs 1,965 From Rs 2,116 per share

– Factoring in impact Of competition in drug Mycophenolate Mofetil Suspension (MMS)

– MMS will likely contribute 16 percent to company’s US revenues and 29 percent to net earnings in FY19

– Factoring in 52 percent and 20 percent decline in MMS sales for the company in FY20 & FY21, respectively

– MMS’ profitability is substantial, impact on net earnings is higher

Deutsche Bank on UPL

– Buy rating, target at Rs 970 from Rs 850 per share

– Valuation looks reasonable for FY21 estimate price to earnings ratio Of 12.8x

– Factor in 40 percent of the announced cost synergies Of $230 million from FY21 onwards

– Increase in FY21 estimate earnings per share is however only 2 percent

– Factor in likely restructuring costs in near-term to achieve guided synergy benefits

Deutsche Bank on Gujarat Gas

– Buy rating, target at Rs 160 per share

– NGT orders ceramic units in Morbi to shift to natural gas

– Company the primary beneficiary, Petronet LNG to benefit too

– More Action against air pollution favors natural gas consumption

– Every 1 mmscmd additional gas sales volume leads to a 20 percent increase in company’s earnings

Deutsche Bank on ICICI Prudential Life

– Buy Rating, target at Rs 440 per share

– Growth trajectory strengthening, risk-reward favourable

– February was the second successive month of double-digit growth with annual premium equivalent growing at 14.5 percent year-on-year.

– FY20 to benefit from a low base; equity sentiment uptick as also a growth positive

– Margin expansion should continue

Macquarie on ABB

– PowerGrid business is to be vertically demerged into a separate company and subsequently listed

– Weak sector outlook will struggle to get the current lofty valuations

– The demerger would be incrementally negative as discovered valuations are likely to be lower

– Underperform rating, target cut to Rs 812 from Rs 967 per share

– Cut earnings estimates for next two years by 48-52 percent, primarily due to demerger

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KV Prasad Journo follow politics, process in Parliament and US Congress. Former Congressional APSA-Fulbright Fellow