Piramal Pharma – Work-In-Progress To Address Challenges In The CDMO Segment: Motilal Oswal

As a demerged entity, Piramal Pharma Ltd. reported its first quarter of detailed financials. The receipts from government grants have been included in other income and excluded from Ebitda and hence it is not comparable with our Ebitda estimate.

Including other income, Ebitda stood at Rs 2.2 billion (our estimate: Rs 2.3 billion). The moderate YoY growth in sales and increased opex affected profitability on a YoY basis.

We have recalibrated Piramal Pharma’s FY23/FY24 earnings estimate based on:

1. its detailed financials,

2. prolonged period of pandemic-induced challenges in the contract development and manufacturing organisation business, and

3. improved traction in the complex hospital generics and the India consumer products segment.