Indegene shares drop 4% as Q4 profit falls sequentially

Indegene shares declined over 4% in intraday trade on Thursday, a day after the newly listed healthcare tech firm released its earnings report for March quarter of the financial year 2023-24. The sentiment was dented as the Bengaluru-based technology-led healthcare solutions provider registered sequential drop in its net profit and revenue, albeit top and bottom line grew year-on-year.

Reacting to Q4 numbers, shares of Indegene, which made debut on the stock exchanges this month, opened a tad lower at ₹526 against the previous closing price of ₹527.85 on the BSE. During the session so far, the heathcare stock declined as much as 4.4% to ₹504.55, while the market capitalisartion slipped to ₹12,390 crore.

Indegene shares touched its record high of ₹659.70 on its listing on May 13, 2024, rising 46% against the initial public offering (IPO) price of ₹452 per equity share. The stock has seen a correction of 23.5% since its debut, falling to ₹504.55 level in intraday, albeit it trades 11.6% higher than the issue price. 

For the fourth quarter ended March 31, 2024, Indegene posted consolidated profit at ₹94.9 crore, which was up 94.6% year-on-year (YoY) and down 3.9% quarter-on-quarter (QoQ). The revenue from operations grew 6.5% YoY and flat QoQ at ₹673 crore. On the operating front, EBITDA was at ₹164.3 crore, up 48.7% YoY and 1.4% sequentially.

For the full financial year 2024, Indegene recorded revenue of ₹2,589.6 crore, up 12.3% YoY, while profit jumped 26.5% to ₹336.7 crore as compared to same period last year. EBITDA grew 28.6% to ₹584.1 crore in FY24 from ₹454.2 crore in FY23.

Geography wise, North America business contributed 64.8% to its Q4 revenue, while Europe region generated 32.5% revenue during the March quarter. The contribution of India business to revenue was merely 0.6%.

Indegene, which provides digital services for the life sciences industry, generated 93.8% revenue from biopharma industry, 2.8% from medical devices, and 2.7% from emerging Biotech space during the March quarter of FY24. Business wise, Enterprise Commercial Solutions contributed 58.3% to the revenue, followed by Enterprise Medical Solutions (23.8%), and Omnichannel Activation (13.1%).

As of March 31, 2024, the company had 63 active clients as compared to 62 in FY23.

Manish Gupta, Chairman and Chief Executive Officer, said, "We are pleased with our continued performance this quarter and the full year. Today in the marketplace we are known as a digital first commercialisation partner to the global life sciences industry.

“We have 63 active clients and work with all the top 20 global pharmaceutical companies. Our revenues very closely mirrors the global life sciences industry's spends on operations. 69% of our revenues come from the top 20 Pharma companies. Global Life Sciences industry is more than $1.8 trillion Industry. We are excited about the opportunity in front of us," Gupta says.

As of March 31, 2024, Indegene had an employees count of 5,081, while voluntary attrition was 15.7%.

Earlier this month, the company raised ₹1,842 crore via IPO, which received an overwhelming response from investors, with the issue subscribing 70.3 times. The IPO comprises a fresh issue of equity shares worth up to ₹760 crore and an offer for sale (OFS) of shares worth ₹1,082 crore by existing shareholders and investors. 

The company intends to use capital raised from the issuance of fresh equities to fund the repayment of debts of one of its material subsidiaries, ILSL Holdings, Inc. A part of the capital will be used for funding the capital expenditure requirements of the company and one of its subsidiaries, Indegene, Inc., as well as to meet general corporate purposes and inorganic growth.

Established in 1998, the company helps life sciences industry with drug development, clinical trials, regulatory submissions, pharmacovigilance, complaints management, and sales/marketing support.

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