Cipla Stake Sale: Promoters Likely Sell 1.72% Equity in Block Deals

A total of 1.39 crore shares of Cipla Ltd., accounting for 1.72% of the company's equity, were sold through block deals on Monday. As previously reported by CNBC TV18, the promoters are likely the sellers.

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The block trades were estimated at approximately ₹2,000 crore, representing a 6% discount to Cipla’s closing price of ₹1,529.9 on Friday, November 29, as per the earlier CNBC TV18 report.

On Friday, Cipla's share price rose by 2.6%. Over the past year, the stock has surged around 26%, boosting the company’s market capitalization to ₹1.2 lakh crore. It has notably outperformed the NSE Nifty 50 index, which saw gains of over 16% during the same period.

As of September 30, 2024, Cipla's promoter and promoter group held a 30.92% equity stake in the company. This sale follows a similar transaction in May 2024, where the promoters divested a 2.53% stake for ₹2,690 crore, reducing their holding from 33.47% to 30.92%. That earlier sale was conducted at a price of ₹1,345 per share.

For Q2 FY24, Cipla recorded a 15% year-on-year increase in net profit, amounting to ₹1,303 crore. Revenue from operations grew by 5% year-on-year to ₹7,051 crore, compared to ₹6,678 crore in the same quarter the previous year. The company's EBITDA rose by 8.7% year-on-year to ₹1,885.5 crore, with a margin of 27%.

Cipla's North American sales rose 4% year-on-year to $237 million, driven by strong performance in its differentiated portfolio. Meanwhile, its India business reported a 5% year-on-year growth.

The offer price for the latest transaction was set at ₹1,442 per share, a 6% discount to Cipla's current market price. The total deal size was estimated at around ₹2,000 crore.

In the September quarter, Cipla's net profit growth of 15% to ₹1,303 crore aligned with CNBC-TV18’s poll estimate of ₹1,250 crore. A year earlier, the net profit was ₹1,131 crore.

The company's revenue of ₹7,051 crore for the quarter matched expectations of ₹7,041.6 crore, marking a 5% year-on-year increase. EBITDA for the quarter rose to ₹1,885.5 crore, compared to ₹1,733.8 crore a year ago, with a margin of 27%, exceeding the CNBC-TV18 estimate of 26%.

During the July-September period, Cipla's North American sales reached $237 million, up 4% year-on-year, supported by its differentiated portfolio. The India business posted a 5% year-on-year increase, with branded prescription products outperforming the market in key chronic therapy areas. The consumer health segment saw a 21% year-on-year growth.