Biocon shares tank 6% after reporting net loss of Rs 16 cr in Q2FY25

Shares of pharmaceutical company Biocon tanked 5.96 per cent at Rs 301.65 a piece on the BSE. Biocon share price today fell in the early hours of trade after it reported a net loss in the second quarter of financial year 2024-25 (Q2FY25).

 

Biocon reported a consolidated net loss of Rs 16 crore for the second quarter ended September 30, 2024. Biocon Group CEO Peter Bains attributed the loss to the increased tax burden related to the geographical distribution of profits and minority interest. 

 

In the same period last fiscal, the company had recorded a net profit of Rs 126 crore. Revenue from operations for the September quarter was Rs 3,590 crore, a 3.6 per cent increase from Rs 3,462 crore in the corresponding period last year. Earnings before interest and taxes (Ebit) came in at Rs 718 crore, resulting in a margin of 20 per cent.

 

 

Revenue from the biosimilars segment increased to Rs 2,182 crore, up from Rs 1,969 crore, marking a growth of 10.8 per cent. This positive trend is largely due to gains in the US oncology and insulin franchises. However, the Generics business continues to grapple with pricing pressures and declining demand. Additionally, a planned shutdown of one of the API facilities during the quarter further impacted revenues, Biocon said. 

 

Biocon Group Chairperson Kiran Mazumdar-Shaw stated that the group's overall financial and operational performance in Q2 FY25 lays a strong foundation for improvement as they progress into the latter half of the fiscal year. She highlighted robust growth in the biosimilars segment, driven by significant market share gains in US oncology and insulin franchises.

 

Syngene has shown a return to sequential growth and is expected to gain momentum in the upcoming quarters, particularly in its discovery services and biomanufacturing CMO business. However, Mazumdar-Shaw noted that the generics segment continues to face challenges from price and demand pressures, although upcoming new formulation launches in Q3 and Q4 could facilitate a turnaround before the year's end.

 

She expressed optimism about all three business segments, anticipating better performance in the second half of the year due to product approvals and emerging market opportunities. 

 

In a separate exchange filing on Wednesday, the company also informed that The US Food and Drug Administration (FDA) has classified Biocon Biologics’ drug substance facility at Biocon Campus, (Site 1) located in Bengaluru, Karnataka, as ‘Voluntary action indicated (VAI)’. 

 

This relates to the cGMP inspection conducted by the agency between February 20- 28, 2024 and pertains to the supply of rh-Insulin (rhI) drug substance to the US, the company said.

VAI means objectionable conditions or practices were found, but the agency is not prepared to take or recommend any administrative or regulatory action. 

 

Biocon share price history

The company’s stock has outperformed the market year to date as it has risen 24.4 per cent, while gaining 44.7 per cent in the last one year. In comparison BSE Sensex has risen 10.2 per cent year to date and 24.7 per cent in a year. 

 

The company has a total market capitalisation of Rs 38,203.09 crore. Its shares are trading at a price to earnings multiple of 914.85  times and at an earning per share of Rs 0.35. 

 

At 11:39 AM, the stock price of the company pared almost all its losses and was down 0.81 per cent at Rs 318.20 a piece on the BSE. By comparison, the BSE’s Sensex was down 0.47 per cent to 79,562.84 level.