Angel Broking is bullish on Dishman Pharma and has recommended buy rating on the stock with a target of Rs 155 in its February 11, 2013 research report.
“For 3QFY2013, Dishman Pharmaceuticals & Chemicals (Dishman) reported lower-than-expected results on the OPM and net profit fronts, while sales came in just in line with expectations. The sales and net profit came in at Rs318cr and Rs16cr, vs our expectation of net sales and profits of Rs315cr and Rs24cr respectively. On the positive side, the company posted a good top-line growth and a healthy OPM. We recommend a Buy rating on the stock.”
“Dishman reported net sales of Rs318cr for the quarter, reporting a growth of 19.7percent yoy, just in line with our expectation of Rs315cr. Segment wise, the CRAMS business grew by 23.8percent yoy, whereas the market molecules (MM) business grew by 12.4percent yoy to end Rs109cr. Gross margin for the quarter contracted to 65.8percent (66.8percent in 3QFY2012). The OPM contracted to 17.8percent (18.3percent in 3QFY2012). This has led to the company reporting a net profit of Rs16cr, ie almost same as in 3QFY2012 ( Rs17cr).”
“We expect Dishman’s net sales and net profit to come in at Rs1,536cr and Rs124.8cr, respectively, in FY2014. At current levels, Dishman is trading at 7.8x and 6.1x FY2013E and FY2014E earnings, respectively. We believe the current valuations are attractive, hence, we maintain our Buy recommendation on the stock with a target price of Rs155,” says Angel Broking research report.
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