Shares of Syngene International Ltd, a subsidiary of Biocon, fell 5.91% to ₹796.90 on Friday, January 24, 2025, following a disappointing FY25 guidance update and concerns over delayed demand recovery. Despite posting strong year-on-year growth in revenue and profit, investors reacted negatively to the updated guidance for single-digit revenue growth and flat profit for FY25.
Key Financial Highlights (Q3 FY25):
- Profit After Tax (PAT): ₹1,311 crore, a 17.6% YoY increase.
- Revenue from Operations: ₹9,437 crore, up 10.6% YoY and 5.9% QoQ.
- EBITDA Margin: 30.1%, up from 27.1% YoY, supported by strong operational performance.
Guidance Updates:
- FY25 Revenue Growth: Revised to single digits, down from earlier high single to low double digits.
- PAT Growth: Expected to remain flat for FY25.
- EBITDA Margin: Guidance remains unchanged.
Segment Highlights:
- Discovery Services: Successfully launched “China+1” pilots, converting them into long-term contracts.
- CDMO Division: Strengthened performance driven by biologics and repeat orders from existing customers.
- US Biotech Market: Stabilized, but recovery delayed by 8 to 12 weeks.
Stock Details:
- Previous Close: ₹847.00
- Day’s Range: ₹791.70 – ₹847.95
- Market Cap: ₹320.55 billion
- P/E Ratio: 66.52
- Year Range: ₹607.65 – ₹960.60
Market Reaction:
The sharp downgrade in guidance for FY25, particularly the delay in demand recovery and muted growth expectations, overshadowed the solid quarterly results, leading to a nearly 6% drop in the stock price.
Management Commentary:
Jonathan Hunt, MD & CEO, emphasized the return to growth across business divisions in Q3, setting the stage for momentum in Q4. CFO Deepak Jain highlighted robust EBITDA margins and investments in digital and commercial capabilities to drive long-term growth.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions.