Prime Highlights:
- Torrent Pharma shares jumped 4% after reporting steady Q3 results and progress on the JB Pharma merger, signaling investor confidence.
- The company expects ₹400-450 crore in cost savings from the merger over 2-3 years, with around 20% achievable this year.
Key Facts:
- Revenue grew 17.6% to ₹3,303 crore, and net profit rose 26.3% to ₹635 crore in Q3.
- International markets performed strongly: Brazil up 27%, Germany 8%, and other markets 32%; semaglutide is expected to support growth in FY27.
Background:
Shares of Torrent Pharmaceuticals Ltd. rose 4% on Monday, February 16, after the company reported steady results for the December quarter and made progress on its merger with JB Chemicals & Pharmaceuticals Ltd. Investors are optimistic about future growth and the cost savings expected from the merger.
Torrent owns 48.8% of JB Pharma and is waiting for SEBI approval to finish the merger, expected in the next 6-9 months. The company expects savings of ₹400-450 crore over 2-3 years, with 20% this year. Management also expects revenue synergies to emerge after integration.
Analysts are positive on the company’s prospects. Nuvama expects the combined entity could potentially double EBITDA by FY30 and generate ₹6,500-7,000 crore in cash flow. Citi and Jefferies maintain ‘Buy’ ratings on Torrent, with price targets ranging from ₹4,380 to ₹4,690 per share.
On the financial front, Torrent reported a 26.3% rise in net profit to ₹635 crore, up from ₹503 crore a year ago. Revenue grew 17.6% to ₹3,303 crore, while EBITDA increased 19% to ₹1,088 crore.
Geographically, India’s revenue grew 14% to ₹1,798 crore, while the US business rose 19% to ₹321 crore. Brazil revenue rose 27% to ₹371 crore, Germany 8% to ₹304 crore, and other markets 32% to ₹509 crore.