August 05, 2016 / 18:26 IST
Religare's research report on Cadila Healthcare
CDH’s Q1FY17 adjusted margins of 21.1% were marginally lower than our estimate (21.6%), but were nevertheless commendable given lower HCQS revenues and weak domestic growth. Management believes that the HCQS impact is largely in the base and margins should improve as product launches pick up over ensuing quarters (12-15 launches by Dec’16). While there was no additional clarity on Moraiya resolution, management expects to invite the USFDA for a re-inspection soon. BUY; Mar’17 TP Rs 370.
We retain estimates and maintain our BUY rating on the stock. The Moraiya facility resolution is the next key stock trigger, in our view.
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