Glenmark Pharma

Glenmark’s 2Q PAT (Rs1.18bn) came in 5% ahead of MLe driven by strong 50% topline growth and stable 30%+ EBITDA margin. US generics business grew sharply by 117% whereas Latam and RoW markets growth is back on track. Revise core earnings estimates by 8-9% to reflect lower margins.

With 35 products in market, US generics business grew 117% YoY (Rs1.76bn) leading to overall generics business growth of 86%. Impact of new launches (out of 40 ANDAs pending approval) is likely to reflect in the next few qtrs. Latam and SRM markets bounced back after a weak 1Q and are expected to show strong growth going forward. Domestic business growth is robust at 17% (vs industry grwth of 11% and guidance of 15%). Milestone guidance maintained for FY09E.

Fully Diluted EPS is expected to be Rs 30 for FY09.