13 February 2020 IPCA is one of the companies with high exposure to domestic formulation (DF; 40% of sales), a favorable opportunity in API (23% of sales) and better traction in international generics. We raise our EPS estimate by 10%/10.5%/11.4% for FY20/21/22 and also growth in DF, a revival in int. generics and sustained momentum in API. strong growth in exports (generics) and API. Exports (generics) grew 39% YoY to INR2b (16% of sales), API sales were up 24% YoY at INR3b (23% of sales), while DF sales increased 15% YoY to INR4.9b (40% of sales). Exports (branded + institutional) grew 12% YoY to INR1.6b (13% of sales). Gross margin shrank 120bp YoY to 65.1% due to a change in product mix (higher share of API sales). EBITDA margin contracted 70bp YoY due to a lower gross margin and higher employee cost (+60bp YoY), offsetting the benefit of lower other expenses (- 120bp YoY).