Continuous investments and erosion in gAbilify saleshave led to a correction in the stock. We believe that the business remains attractive at these valuations. Maintain BUY with a TP of Rs 635 (20x Jun-19E). Alembic Pharmas (ALPM) top-line declined ~12% YoY in 1QFY18, with the domestic business plummeting 21% YoY. The EBITDA margin at 15.8% was down 575bps YoY (240bps miss). PAT stood at Rs 667mn, down ~36%YoY. In our view, while 1QFY18 was a weak quarter for ALPM, this was largely expected on account of pre-GST channel de-stocking. Profitability was further impacted by compensation given to dealers for lost input tax credit. The only positive was sequential growth in the US base business (five product launches in 1QFY18).