Indian drugmaker Torrent Pharmaceuticals reported a 21.9% decline in fourth-quarter profit on Friday, as acquisition-related expenses linked to its deal with JB Chemicals and Pharmaceuticals weighed on earnings despite strong revenue growth.
The company posted a consolidated net profit of 3.89 billion rupees ($40.65 million) for the quarter ended March 31, compared with 4.98 billion rupees in the corresponding period last year.
Torrent Pharmaceuticals also announced a dividend of 9 rupees per share.
Revenue growth remains strong
The company’s total revenue from operations rose 41.8% year-on-year to 41.97 billion rupees during the quarter.
The growth was supported by strong momentum in its domestic formulations business.
India, which remains the company’s largest market, recorded revenue growth of 43% year-on-year.
The increase was driven by strong performance in chronic therapies.
International markets also contributed positively to revenue growth during the quarter.
Revenue from the United States rose 31%, while revenue from Brazil increased 30%, aided by recent product launches.
Despite the strong top-line performance, rising costs weighed on overall profitability.
Expenses outpace revenue growth
Torrent Pharmaceuticals said total expenses rose nearly 60% during the quarter, significantly outpacing revenue growth.
The increase was mainly driven by higher employee expenses, finance costs, and depreciation charges.
The company also incurred exceptional costs related to regulatory fees and integration expenses associated with the JB Pharma deal.
These acquisition-related costs impacted the company’s bottom line during the reporting period.
Operational EBITDA margin stood at 32.3% during the quarter, compared with 33% a year earlier, reflecting pressure from rising expenses.
Focus on chronic therapies supports India’s business
The company’s India business continued to remain a key growth driver during the quarter.
Torrent Pharmaceuticals said strong demand in chronic therapies supported the growth in domestic formulations revenue.
The company has traditionally maintained a strong presence in therapeutic segments such as cardiovascular, central nervous system, gastrointestinal, women’s healthcare, diabetology, pain management, and oncology.
The company is widely recognised for introducing the concept of niche marketing in India.
Global presence and strategic acquisitions
Founded in 1971 and headquartered in Ahmedabad, Gujarat, Torrent Pharmaceuticals is the flagship pharmaceutical business of the Torrent Group.
The company focuses on the research, manufacturing, and marketing of branded generics and pharmaceutical formulations across more than 50 countries.
Torrent Pharmaceuticals operates manufacturing facilities across multiple Indian states, including Gujarat, Himachal Pradesh, Sikkim, and Andhra Pradesh.
The company also maintains a significant international presence and ranks among the leading Indian pharmaceutical companies in Brazil and Germany.
Over the years, Torrent Pharmaceuticals has expanded its market position through strategic acquisitions.
These include the acquisition of Curatio Healthcare in 2022, Unichem’s Indian branded business and Sikkim plant in 2017, and Elder Pharma’s Indian branded business in 2014.
The latest quarter reflects the impact of the company’s ongoing expansion strategy, with acquisition and integration-related expenses affecting earnings even as revenue growth remained strong across key markets.
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