Alkem Laboratories Ltd.

NSE: ALKEM | BSE: 539523 | ISIN: INE540L01014 |Industry: Pharmaceuticals
|Expensive Performer

Alkem Laboratories Ltd.    
09 Feb 2019
HDFC Securities
Maintain BUY with a revised TP of Rs 2,340 (22x Dec-20E EPS). Alkems 3QFY19 performance was in line with our expectations. A softer acute season led to a 1% fall in the domestic business, while the 44% jump in the US helped in maintaining 10% plus YoY top line growth. Poor business mix (lower India sales) and increased raw material cost led to a ~680bps drop in gross margin. As a result, EBITDA margin shrunk 450bps YoY and EBITDA declined 13% to Rs 3.1bn. Reported PAT at Rs 2.1bn was up 14% YoY owing to higher taxes in 3QFY18
Alkem Laboratories Ltd. is trading above it's 150 day SMA of 1768.35
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