JB Chemicals Q2 Results: Profit, Revenue Meet Estimates

JB Chemical's revenue exceeded Rs 1,000 crore for the second consecutive quarter:

• Domestic formulations revenue reached Rs 588 crore, a 22% growth of 22%. Excluding ophthalmology, domestic business growth was 12%.

• International revenue grew 3% to Rs 413 crore, driven by a strong recovery in international formulations, though the contract development and manufacturing organisation division remained muted due to seasonal factors but is expected to perform well in the second half.

• Gross margin stable at 66.2%.

• Excluding the ophthalmology business, gross margin improved over 150 basis points YoY.

• Gross margins benefited from cost optimisation, favourable product mix, and price growth, while overheads, including employee costs, were controlled to support operating margins.

• Elevated freight costs continued to affect the international business.

• Depreciation was consistent at Rs 42 crore, and finance costs fell to Rs 2 crore from Rs 10 crore due to reduced gross debt, which stood at Rs 82 crore as of Sept. 30, 2024.

• Net profit increased 16% to Rs 175 crore.

• Domestic business grew 22% to Rs 588 crore, contributing 59% of the first-half revenue versus 55% in the year-ago period.

• JB Pharma outperformed the Indian pharmaceutical market with an 11% YoY growth versus IPM's 7.6%.

• International revenue grew 3% to Rs 413 crore, with international formulations rising 14% to Rs 300 crore.

• The South African and US markets showed double-digit growth, and Russia and branded generics exports saw high single-digit growth.

• CDMO business performance was muted in the first half due to material availability challenges, delaying sales to the third quarter. Strong third and fourth-quarter results are expected, with a healthy order book.

• Active pharmaceutical ingredient revenue was Rs 19 crore.