Lupin - Launches Critical For Sustenance Of Turnaround: ICICI Securities

ICICI Securities Report

Lupin Ltd.’s U.S. business had grown by a robust 33.8% YoY, driven by gSpiriva which had helped the company post a turnaround in overall growth and margins in FY24. Lupin’s dependence on gSpiriva is significant (expect sales/Ebitda contribution of 4%/17%, respectively); while competition in this product may not be imminent in the near term, potential price cuts by innovator and limited scope for market share improvement (30- 35%) may limit further upside from this product in FY25-26E.

Further, competition in Albuterol may hurt U.S. sales run-rate for couple of quarters while we believe the impact on Ebitda and margins may not be high (less than 4% of sales and Ebitda) and can be absorbed by 10 new launches which the company is targeting for FY25.

The company is likely to launch doxycycline and mirabegron along with 7-8 niche products in U.S. in FY25 which may aid single digit growth. Uncertainties over the launch of other key products such as gDulera and tolvaptan ($50 million sales factored in FY26E) prevail.

The company has a pipeline of ~20 complex products which can aid growth in U.S. beyond FY27.

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