Sharekhan's research report on Cipla
Cipla’s Q4FY2023 numbers was a mixed bag as it outperformed our expectations on the revenue front as revenue of ~Rs. 5,739 Cr was above our estimate of Rs. 5,565.1 Cr. while EBITDA came in line at ~Rs. 1,174 Cr vs. our estimate of Rs. 1,169 Cr and adjusted PAT was slightly below estimates at ~Rs. 653.7 Cr vs. our estimate of ~Rs. 673.0 Cr. Some of Cipla’s key facilities continue to languish under the USFDA scanner such as Indore and Goa. India segment revenue continue to grow at a tepid pace due to high base effect associated with COVID 19 sales. R&D spend is expected to continue to rise due to a likely increase in spend on differentiated portfolio of products and biosimilars, which restricts the likelihood of EBITDA margin expansion over the short – medium term.
Outlook
We reduce the PT to Rs. 1030 (vs. before Rs. 1,080) and maintain HOLD on it as it trades at ~22.0x and ~19.0x its FY24 and FY25E EPS estimates vs. peers trading at ~18.3x and ~16.1x its FY24E and FY25E EPS estimates, indicating higher valuation.
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.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
