This pharma stock is trending on October 11; know why?

The share surged 8% on the day.

On October 11, the market is trading in the red. At 11:12 am, the S&P BSE Sensex is trading at 57714.63, down 0.48%, while NIFTY50 is trading at 17159.6, down 0.47%. Among sectors, Capital Goods and Healthcare are outperforming, while Metal is underperforming today. Regarding stock-specific action, Glenmark life sciences ltd is among the top gainers.

The share surged 8.47% and is trading at Rs 418.85. The stock opened at Rs 395.9 and has made an intraday high and low of Rs 424.75 and Rs 395.15, respectively.

Glenmark Life Sciences is one of the leading developers and manufacturers of select high-value Active Pharmaceutical Ingredients. The company further operates in contract development and manufacturing operations to offer services to specialty pharmaceutical companies. It is a subsidiary of Glenmark Pharmaceuticals Ltd.

For Q1FY23, the revenue stood at Rs 490 crore, a YoY decrease of 6.07%, and QoQ decline of 4.7%. However, there was an improvement in the EBITDA margin by 60 bps YoY and 320 bps QoQ. Q1FY23 EBITDA stood at Rs 156.3 crore. For the same quarter, Rs 108.7 crore of net profit was generated.

The company operates into two segments- Generic API and CDMO (Contract Development and Manufacturing Organization). According to Q1FY23, the Generic API segment contributed about 95% to the total revenue, while 5% came from the CDMO business.

As per FY22, the company has ROE and ROCE of 29.9% and 42.2%, respectively. While the dividend yield stands healthy at 5.04%.

About the shareholding pattern, 82.85% of the company’s stake is owned by the promoters, 7.58% by FIIs, 0.79% by DIIs, and the rest 8.78% by the non-institutional investors.

The company belongs to BSE group ‘A’ and has a market capitalization of Rs 5116 crore. The scrip is trading at a PE multiple of 11.09x. The stock has a 52-week high and low of Rs 675 and Rs 375, respectively.