Feb 16, 2017 03:23 PM IST | Source: Moneycontrol.com
Hold Ipca Laboratories; target of Rs 560: ICICI Direct
ICICI Direct recommended hold rating on Ipca Laboratories with a target price of Rs 560 in its research report dated February 13, 2017.
ICICI Direct's research report on Ipca Laboratories
Revenues grew 8% YoY to Rs 751 crore (I-direct estimate: Rs 783 crore) mainly due to 9% growth in domestic formulations to Rs 335 crore (Idirect estimate: Rs 355 crore). Export formulations grew 6% YoY to Rs 234 crore (I-direct estimate: Rs 257 crore).
The management has also guided for higher taxation, which has resulted in a 6% EPS reduction in our FY18 and FY19 estimates. We have arrived at our new target price of Rs 560 (18x FY19E EPS of Rs 31.2). Improvement in operating leverage and development on the USFDA front will be key aspects to look for.
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