Divi's Laboratories Ltd. share price target

Other income rose 107.56% to Rs 35.97 crore. Provision for interest rose 21.74% to Rs 0.28 crore. Provision for depreciation rose 30.36% to Rs 73.26 crore. Profit before tax grew 23.22% to Rs 814.48 crore. Share of profit/loss were nil in both the periods. Provision for tax was expense of Rs 257.37 crore, compared to Rs 168.92 crore. Effective tax rate was 31.60% compared to 25.56%. Minority interest was nil in both the...

Divi's Laboratories Limited is engaged in manufacturing and selling of generic active pharmaceutical ingredients (APIs) and intermediates for the United States, Asia, Europe, and internationally. Its manufacturing and research and development facilities are located in the State of Andhra...

Revenues grew 13% YoY to INR19.6b (our est: INR19.9b) for the quarter. The gross margin expanded 420bp YoY to 67.2%. This was largely owing to a superior product mix and lower raw material costs. The EBITDA margin expanded at a lower rate of 300bp YoY to 43.5% (our est: 40.9%) due to higher employee costs (+60bps as a percentage of sales) and other expenses (+60bps as a percentage of sales) EBITDA was up 22% to INR8.5b (our est: INR8.1b) for the quarter YoY. Adjusted for INR196m in forex gains, PAT grew at a lower rate of 13% YoY to...

DIVI delivered in line 4QFY21 earnings. It ended FY21 on a strong note, with 29%/57%/54% YoY growth in sales/EBITDA/PAT. New product development, ongoing capex, and strong prospects in Custom Synthesis (CS) provides...

Divi's Labs (DIVI), in addition to having a robust base business, is enhancing its product offerings in the generic API space at least sixteen molecules are under various phases of development and in the subsequent DMF filing stage. Particularly, we find DIVI's work interesting in the Contrast Media segment. While there is complexity associated with Iodine-based products, DIVI's strong chemistry skill set and experience in the Contrast Media space have enabled it to bring the Iohexol API to the validation phase. We believe DIVI is well-placed to capitalize on the carotenoid opportunity, with a...

The growth was driven across generic APIs and CRAMS businesses. Strong positioning of divis will help in monetizing the growth opportunity in API and CRAMS space given its stellar execution track record and being one of the preferred suppliers. Further, recently done and...

Divi's Laboratories Limited is engaged in the manufacturing and selling of generic active pharmaceutical ingredients (APIs) and intermediates in the United States, Asia and Europe. Its manufacturing and research and...

Divi's Labs (DIVI) reported in-line 3QFY21 earnings. This was led by healthy traction in Generics / Custom Synthesis (CS), coupled with lower raw material cost, driven by process improvements. Meaningful benefit is yet to accrue from the major capex phase. 10 new molecules under development in generic APIs and contrast media APIs would provide a fillip going forward. We maintain our earnings estimate for FY21/FY22/FY23 and roll forward our Target Price to INR4,530, valuing DIVI at 36x 12M forward earnings. We remain positive on DIVI on the back of a) sustained volume growth in the...