Categories Concall Highlights, Earnings, Health Care

Glenmark Life Sciences Limited Q1 FY23 Earnings Conference Call Insights

Key highlights from Glenmark Life Sciences Limited (GLS) Q1 FY23 Earnings Concall

Q&A Highlights:

  • [00:14:56] Neha Manpuria from Bank of America asked about the generic API business, ex-COVID growth, how much of the growth is volume vs. pricing that has flown through. Yasir Rawjee MD replied that the growth is mainly volume growth. However, GLS was able to pass quite a bit of price increase to some of its customers on some APIs.
  • [00:19:08] Neha Manpuria from Bank of America asked about RM cost pressure, improvement in pricing and impact on GM. Yasir Rawjee MD replied that the margins on the material side have gone up vs. last quarter, which is mainly driven by softening solvent prices.
  • [00:27:04] Shyam Srinivasan with Goldman Sachs enquired about guidance for FY23 on topline growth and margins.  Yasir Rawjee MD answered that given the fact that the company has still got three quarters going, it should still come through with around 12% growth for FY23. And on margins, GLS feels the worst is already baked in.
  • [00:29:10] Krish Mehta from Enam Holdings asked about the absolute amount of working capital for 1Q23. Tushar Mistry CFO replied that the working capital is at 168 days. On an absolute number basis, it’s about INR960 crores and a major part of that is from inventory which is at about INR600 crores.
  • [00:29:59] Krish Mehta from Enam Holdings enquired about the guidance of working capital for the rest of year. Tushar Mistry CFO answered that the company expects to see this levels remain at this level for the near term.
  • [00:30:46] Tarang Agrawal with Old Bridge Capital asked new launches, in which markets were the launches and the segments. Yasir Rawjee MD said that the launches were in the US and in the CNS and cardiovascular segment.
  • [00:30:54] Tarang Agrawal with Old Bridge Capital also asked about the nitrosamine issue still impacting the sartans business in North America. Yasir Rawjee MD replied that it’s the customer taking a call if they want to continue with sartans given the regulatory challenges they face.
  • [00:33:34] Vikas Sharda of NTAsset asked about the PLI benefit, how does it work and the expansion it’s linked to. Yasir Rawjee MD answered that there is a base in FY20 and GLS had to submit the number of APIs where there would be growth. A list of 85 APIs were submitted where GLS could see growth in 5 years. GLS feels it’s in a good positing with these 85 APIs.
  • [00:40:17] Naman Bhansali from Perpetuity Ventures enquired about the dependency on parent company Glenmark Pharma. Yasir Rawjee MD answered that on the revenue side, 35% came from Glenmark Pharma in 1Q23.

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