Hikal Ltd. share price target

custom duty) of INR154mn. The company posted revenues of INR 3,211mn with 18.7% YoY decline which was below our estimate of INR,4,845mn. Multiple factors affected revenue growth during the quarter such as 1) Crop protection business was affected by heavy flooding at Mahad facility in the month of august which led to temporary production shut down.2) Pharmaceutical business faced issue at taloja facility where MIDC had cut 50% of the water supply to all industries in that region during Q2 and destocking of some of the products by innovator clients led to postponement in product...

Hikal ventured into the pharma API business by virtue of acquisition of Novartis' Panoli plant in 2000. In a short span of time, banking on its chemistry skills, the company has been able to tap incremental customers via the CDMO route. Hikal also operates as a dedicated API supplier as it expands its portfolio. We expect the pharma segment to grow at a CAGR of...

Q1 revenues grew 23.8% YoY to | 403.2 crore (I-direct estimate: | 368.4 crore) on account of 15.2% YoY growth in pharma segment to | 203.9 crore (I-direct estimate: | 212.4 crore) and 34.1% YoY growth in crop protection segment to | 199.3 crore (I-direct estimate: | 156.1 crore). EBITDA margins contracted 163 bps YoY to 17.0%, (I-direct estimate: 18.5%), fall in gross margins (43.4% vs. 49.4% in Q1FY19) was partly offset by decline in other expenditure. EBITDA grew 13% YoY to | 68.5 crore (I-direct estimate: | 68.1 crore. Net profit grew 58.4% YoY to | 25.2 crore (I-direct estimate of | 18.5...

in gross margin due to change in product mix, EBITDA margin manage to remain at 18.4% level, was 121bps lower than our estimate. Adj. PAT came above our estimate at INR333mn (est INR298mn) Sector Outlook supported by lower tax expense (30.8% vs 35.3%) and decline in interest cost....

Q4 revenues grew 17.2% YoY to | 457.5 crore (I-direct estimate: | 450.3 crore) on account of 20.7% YoY growth in the pharma segment to | 259.2 crore (I-direct estimate: | 268.4 crore) and 12.8% YoY growth in the crop protection segment to | 198.4 crore (I-direct estimate: | 175.8 crore). EBITDA margins remained at ~18.4%, (I-direct estimate: 19.2%). The fall in gross margins (75.8% vs. 79.3% in Q4FY18) was offset by a decline in employee cost and other expenditure. EBITDA grew 17.5% YoY to | 84 crore vis--vis I-direct estimate of | 86.6 crore. Net profit grew 31.6% YoY to | 33.3...

One of very few global and only Indian company to provide Active Ingredients for both Pharmaceuticals Agrochemical Hybrid Model....

Hikal ventured into the pharma API business by virtue of acquisition of Novartis' Panoli plant in the year 2000. In a short span of time, banking on its chemistry skills, the company has been able to tap incremental customers via the CDMO route. Hikal also operates as a dedicated API supplier as it expands its portfolio. We expect the pharma segment to grow at a CAGR of...

We met the management of Hikal Ltd (Hikal) to gain an insight into the company's pharma and agrochem businesses. Established in 1988, Hikal is a B2B player, which provides active ingredients, intermediates and R&D; services to global pharmaceuticals, animal health, crop protection and specialty chemicals companies. For FY18, pharma and agrochem accounted for 58% and 42%, respectively, of total operating revenues. The pharma business is currently divided almost equally between generic active pharma ingredients (APIs) and contract research and...

Valuation: At CMP of Rs. 208 ,Hikal Ltd. is trading at a P/E multiple of 21.6(x) compared to the industry peer of 36.5(x). The company has an upside potential of 20% to 25% in the next 12 to 18 months. We arrive at a target price in range of...