IPCA's Ratlam based API plant has been issued an import alert by the USFDA following the Form 483 observations including data integrity issues in July 2014. In our view, the import alert will further delay the resumption of the US business by ~2 years. Besides, higher remediation costs would hit the margins in the near term as well. Accordingly, we pencil in 100bps downward revision in our margins at 21% for FY15E and gradual recovery for the next 3 years. IPCA's investments in the past few years were concentrated towards US resulting into lower ROIs until resolution. Further, given that 4 of its products are exempted from the alert,...