ICICI Direct recommended hold rating on Divi's Laboratories with a target price of Rs 1640 in its research report dated August 12, 2019.
ICICI Direct's research report on Divi's Laboratories
Q1FY20 revenues grew 16.8% YoY to Rs 1162.9 crore (I-direct estimate: Rs 1318.4 crore), driven by strong growth in generic segment. EBITDA margins fell 206 bps to 33.3% (I-direct estimate of 36.8%) mainly due to higher other expenditure. EBITDA grew 10% YoY to Rs 387.1 crore (I-direct estimate: Rs 484.5 crore). Net profit grew 2.4% to Rs 272.4 crore (I-direct estimate: Rs 350.2 crore) mainly due to a below expected operational performance.
Margins are also likely to get support from extensive backward integration, product mix and operating leverage. We ascribe a target price of Rs 1640 based on 26x FY21E EPS of Rs 63.1.
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.Subscribe to Moneycontrol Pro and gain access to curated markets data, trading recommendations, equity analysis, investment ideas, insights from market gurus and much more. Get Moneycontrol PRO for 1 year at price of 3 months at 289. Use code FREEDOM.