Lupin - Cost Optimization Leads Earnings Upgrade In Q3: Prabhudas Lilladher
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Prabhudas Lilladher Report
We increase our earnings estimate of Lupin Ltd. by 8%/4%/6% for FY21/22/23E on back of lower research and development spend guidance of 9% of sales (versus earlier 10%) and cost optimization towards U.S. branded business.
Q3 FY21 Ebitdam was higher than our estimate as R&D spend declined 19% YoY and 9% QoQ with favorable business mix.
The company’s margin has been lower (compared to peers of 18-20%) due to cost escalation in recent past, regulatory issues and lack of key products launch.
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