ICICI Direct recommended hold rating on Divi's Laboratories with a target price of Rs 1850 in its research report dated November 06, 2019.
ICICI Direct's research report on Divi's Laboratories
Revenues grew 12.5% YoY to Rs 1445.6 crore (I-direct estimate: Rs 1351.4 crore) mainly due to 38.2% growth in Carotenoid segment to Rs 152 crore. EBITDA margins contracted 607 bps YoY to 33.9% (I-direct estimate of 36.1%) mainly due to higher raw material prices and other expenditure. Net profit declined 10.3% YoY to Rs 356.8 crore (I-direct estimate: Rs 350.4 crore) mainly due to a below expected operational performance and other income.
We ascribe a target price of Rs 1850 based on 26x FY22E EPS of Rs 71.2.
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