Shares of Biocon rose nearly 8% in early trading on May 24, boosted by the drugmaker’s strong fourth-quarter earnings.

The drugmaker on Tuesday posted a 31.3% rise in fourth-quarter net profit to Rs 313.2 crore, beating CNBC-TV18’s estimate of Rs 234 crore.

A similar increase was also seen in revenue, which rose 56.7% to Rs 3,773.9 crore, also beating expectations of Rs 3,611.7 crore.

The increase in revenue was driven by more than doubling growth in the biosimilars business, which also accounted for 56% of total revenue. An increase in immunosuppressants, speciality APIs (active pharmaceutical ingredients), and some recently launched generic products also contributed to the strong revenue.

Also, operating metrics improved as the EBITDA margin widened to 26.4% in the January-March period from 24.6% a year ago.

Shares of Biocon were trading at Rs 251.60 on the National Stock Exchange at 10:10 am, up 3.9% from the previous close.

“Looking forward, we will integrate the newly acquired business Vitaris in stages, followed by the transition to Biocon Biologics in more than 70 emerging markets, followed by the US and EU. FY24 will also see several important new product launches, which will be key to growth driving force,” said Shreehas Tambe, CEO and MD of Arm Biocon Biologics, in a bourse filing.

Brokerage firm ICICI Securities also maintained a positive view of the stock. The company believes that progress on biosimilars will be a key determinant of investor sentiment against a backdrop of significantly highly leveraged balance sheets.