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Last Updated : Aug 12, 2020 03:26 PM IST | Source: Moneycontrol.com

Accumulate IPCA Laboratories ; target of Rs 2106: Dolat Capital

Dolat Capital recommended accumulate rating on IPCA Laboratories with a target price of Rs 2106 in its research report dated August 12, 2020.

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Dolat Capital's research report on IPCA Laboratories


IPCA’s Q1FY21 numbers beat our estimates across all fronts led by one-time Rs2.6bn revenue from HCQ supplies (both in India and exports). Even excluding HCQ, growth was strong at 18% YoY with EBITDA margins of 25%. For FY21E, management has revised its guidance upwards to 18-20% revenue growth and EBITDA margin at ~23% led by: 1) strong growth in exports (both formulations and API); 2) order visibility from global fund tender; 3) improving asset utilization (Piparia and Pithampur running at 20% capacity) and cost optimization measures.



Outlook


This will provide IPCA with significant financial capacity to step-up growth investments if the opportunities arise. Also, we estimate the return ratios will improve to 20%+. Maintain ACCUMULATE.


For all recommendations report, click here


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First Published on Aug 12, 2020 03:26 pm
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