Gland Pharma Share

Gland Pharma, a key player in the pharmaceutical industry, has experienced significant ups and downs in the stock market since its IPO in 2020. Despite facing multiple challenges, the company remains a crucial entity in the injectable pharmaceutical space. Let’s dive into its stock performance, financials, and future growth prospects.

Gland Pharma Stock Performance: Highs and Lows

Gland Pharma went public in November 2020 during the COVID-19 pandemic, with an issue price of ₹1,500 per share. The IPO was one of the largest in the pharmaceutical sector, raising ₹6,480 crore. The stock made a strong debut, listing at ₹1,701—a 13.4% premium.

The stock peaked at an all-time high of ₹4,350 on August 12, 2021, driven by investor confidence and growth potential. However, it later faced a steep decline, reaching an all-time low of ₹861 on May 22, 2023. Market volatility, sector-specific challenges, and shifting investor sentiment contributed to this drop.

Currently, Gland Pharma’s 52-week high is ₹2,220, while its 52-week low stands at ₹1,411. The stock remains volatile, influenced by earnings reports, industry trends, and broader market conditions.

Gland Pharma share Financial Performance (Last 5 Years)

Key Financial Trends

• Sales have shown an increasing trend, reaching ₹5,665 crore in FY24, up from ₹3,625 crore in FY23.
• Operating Profit Margins (OPM) have declined from 38% in FY21 to 24% in FY24, reflecting cost pressures.
• Net profit saw a significant decline from ₹1,212 crore in FY22 to ₹773 crore in FY24, indicating profitability challenges.

More Financial News

Why, Gland Pharma share is falling?

1. Rising Operational Costs

In Q1 FY25, Gland Pharma reported a 26% drop in net profit due to a 40% surge in employee benefit expenses, which now account for 29% of total costs.

2. Pricing Pressures in Key Markets

The U.S. market contributes 54% of Gland Pharma’s total sales. However, increasing competition and lower drug prices have put pressure on margins and overall profitability.

3. Analyst Downgrades

Goldman Sachs downgraded Gland Pharma from a “buy” to a “sell” rating in September 2024. The key concerns included:

• Heavy reliance on lower-margin products.
• Delays in launching higher-margin drugs.
• A slower turnaround at Cenexi, its European subsidiary.
• The need for higher capital investments in new ventures.

4. Weak Financial Performance

• Q3 FY25 (Dec 2024): Net profit rose 6.69% YoY to ₹204.69 crore, but revenue declined 10.43% YoY to ₹1,384.05 crore.
• Despite the revenue drop, Gland Pharma improved its operating profit margin to 26.01%, up from 23.06% in the same quarter last year.

The decline in revenue was largely due to soft demand in key markets and production shutdowns at its Penems manufacturing facility in Telangana.

Pharma Stocks Under Sell-Off Pressure Amid Market Decline

The Indian stock market’s broader downturn has triggered a sell-off in pharmaceutical stocks. Investors are pulling funds amid economic uncertainties, regulatory challenges, and global market volatility. Factors like USFDA scrutiny, patent expirations, and rising competition from generics further add to the pressure. As market sentiment remains weak, pharma stocks continue to face selling pressure alongside the broader market decline.

Gland Pharma Share Growth Projections & Future Outlook

• Analysts expect 23.4% annual earnings growth and 10.7% revenue growth.
• Earnings Per Share (EPS) is projected to grow 23.3% per year, with a 10.4% return on equity over the next three years.
• Motilal Oswal predicts a 16% CAGR in sales (FY24-FY26), compared to just 2% CAGR in FY22-FY24.
• Earnings CAGR is expected to be 20% over FY24-26, driven by:
  1. Strong core market performance.
  2. Recovery at Cenexi, its European subsidiary.
  3. Expansion in new geographies and therapeutic areas.

Stock Valuation & Investment Returns

Current Stock Price & Market Metrics

• Stock Price (as of March 3, 2025): ₹1,538.80 (-0.97%)
• Market Cap: ₹25,334 crore(approximately)
• Price-to-Earnings (P/E) Ratio: 36.30 (relatively expensive)
• Dividend Yield: 1.29% (moderate passive income)

Investment Returns Over Time(approximately)

• Investors who bought two years ago have seen a 19.95% gain, signaling a potential turnaround.
• However, long-term returns remain negative, reflecting the stock’s high volatility.

More About Gland Pharma

Gland Pharma, established in 1978 and headquartered in Hyderabad, specializes in injectable formulations. The company:

• Develops and markets complex generic injectables across oncology, cardiology, and anti-infectives.
• Operates in highly regulated markets, including the U.S., Europe, and Canada.
• Became a subsidiary of Fosun Pharma in 2017 after the Chinese firm acquired a majority stake.
• Focuses on high-quality sterile injectables and strong R&D capabilities.
• Gland Pharma’s promoter is Fosun Pharma, a Chinese pharmaceutical company. Fosun acquired a majority stake in Gland Pharma in 2017, making it the company’s largest shareholder. However, in recent years, there have been reports of Fosun exploring a partial or complete stake sale in Gland Pharma due to financial restructuring efforts.
• Gland Pharma’s Price-to-Earnings (P/E) ratio is 22.61, which is lower than many of its peers, indicating a relatively undervalued position in the market.
  1. Higher P/E Peers:
     • Suven Pharma (103.38) and Laurus Labs (114.33) have significantly higher P/E ratios, suggesting premium valuations.
     • Biocon (60.62) and Ipca Laboratories (44.37) are also trading at higher earnings multiples.
  2. Closer Comparisons:
     • Ajanta Pharma (34.73) and JB Chemicals & Pharma (39.25) have moderately higher P/E ratios than Gland Pharma.
     • Piramal Pharma (36.87) also trades at a higher multiple.

  Gland Pharma’s lower P/E ratio suggests it might be relatively undervalued compared to its peers, potentially due to market concerns, growth prospects, or investor sentiment.(Till 3 March)n

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