Credit Suisse sees improvement in margins for Sun Pharma, Cipla

New Delhi: The June quarter earnings should be weak for Cadila Healthcare and Lupin with sharp declines in the US sales on a QoQ basis, said global brokerage firm Credit Suisse (CS).

It says Cadila’s US sales will decline 20 percent due to seasonality impact of Tamiflu drug and market share loss to Teva on Lialda, which is used to treat inflammatory bowel disease.

Sun Pharmaceutical, India’s largest drugmaker, and Mumbai-based Cipla should report sequentially improving margins with higher contribution from domestic business, the brokerage said.

India sales growth for Cipla to be 25 percent YoY on a low base of goods and services tax, while US sales should grow 3 percent QoQ with increasing market share in asthma-related drug Pulmicort and anti-cancer chemotherapy drug Decitabine.

For Dr Reddy’s Laboratories, suboxone, which is used to treat opioid addiction, acute pain, and chronic pain, should mask off weakness in base business, the brokerage said.

CS expects “lacklustre” quarter for Aurobindo Pharma, while higher Unichem growth and margins are expected for Torrent Pharmaceuticals.