Alembic Pharmaceuticals Ltd. share price target

Downgrade to NEUTRAL with a TP of Rs 555 (20x on Sep-19E). Alembic Pharmas (ALPM) top-line declined ~10% YoY in 2QFY18 on a high base of 2QFY17, which included limited competition sales of gAbilify. There was QoQ growth of 23%. The domestic business performance was disappointing, growing only ~6% YoY in spite of the benefits of channel re-stocking. The EBITDA margin surprised positively at ~23%, up 230bps/690bps YoY/QoQ (370bps beat). This was largely driven by operating leverage and a favourable business mix. PAT stood at Rs 1.2bn, up ~82% QoQ.

remained flat sequentially, but as % of sales, it rose by >400bp). PAT increased 2% YoY to INR1.2b (23% beat). Strong recovery in domestic business; US remains under pressure: Domestic business grew 6% YoY, driven by ~10% YoY growth in Specialty business. Top-line growth in domestic market was impacted by treatment of excise duty post GST implementation. On a like-to-like basis, domestic business grew ~13% YoY. International business sales declined 26% YoY. US business declined by ~29% YoY and non-US business by ~13% YoY. We...

Alembic Pharma posted marginally lower than expected results for 1QFY2018. In Rupee terms, revenues de-grew by 12.0% yoy to `648cr (`737cr expected) v/s. `737cr in 1QFY2017. International formulation came in at `282cr v/s. `309cr in 1QFY2017, a yoy dip of 8.7%. Indian formulation sales came in at `236cr v/s. `299cr in 1QFY2017, a yoy dip ..

Alembic Pharma's (ALPM) Q1FY18 results were below estimates due to 21% YoY decline in India revenue (estimate: 12% YoY decline) on channel destocking ahead of GST rollout. Management expects gradual restocking in the trade channel, and subsequent volume recovery through Q2'18. US sales declined ..

Continuous investments and erosion in gAbilify saleshave led to a correction in the stock. We believe that the business remains attractive at these valuations. Maintain BUY with a TP of Rs 635 (20x Jun-19E). Alembic Pharmas (ALPM) top-line declined ~12% YoY in 1QFY18, with the domestic business plummeting 21% YoY. The EBITDA margin at 15.8% was down 575bps YoY (240bps miss). PAT stood at Rs 667mn, down ~36%YoY. In our view, while 1QFY18 was a weak quarter for ALPM, this was largely expected on account of pre-GST channel de-stocking. Profitability was further impacted by compensation given to dealers for lost input tax credit. The only positive was sequential growth in the US base business (five product launches in 1QFY18).

ICICI Securities Ltd | Retail Equity Research Revenues declined 12% YoY to | 648 crore (I-direct estimate: | 672 crore) mainly on account of a 21% decline in domestic formulations to | 236 crore on the back of GST transition. Total export sales declined 9% to | 282 crore in line with I-direct estimate EBITDA margins contracted 565 bps YoY to 15.6% (I-direct estimate: 18.0%) due to higher employee cost and R&D; expenses. EBITDA declined 35% YoY to | 101 crore (I-direct estimate: | 121 crore)...

Revenue fell by 4.59% to Rs. 741.35 Cr in Q4FY17 when compared to the previous quarter.

Alembic Pharma posted marginally lower than expected results for 4QFY2017. In Rupee terms, revenues grew by 17.8% yoy to `737cr (`770cr expected) v/s `626cr in 4QFY2016. In sales terms, the company posted growth on the back of international formulations, which grew by 44% yoy, while the Indian domestic formulations grew by 6.0% yoy. On th..

ICICI Securities Ltd | Retail Equity Research Revenues increased 18% YoY to | 741 crore (I-direct estimate: | 783 crore) on account of 54% YoY growth in the US to | 200 crore. Domestic formulations grew 10% YoY to | 286 crore (I-direct estimates: | 304 crore) driven by 13% growth in speciality portfolio EBITDA margins contracted 471 bps YoY to 18.2% (I-direct estimate: 19.2%) due to higher raw material and employee cost. EBITDA declined 6% YoY to | 135 crore (I-direct estimate: | 151 crore)...

Alembic Pharmas (ALPM) top line grew ~18% YoY in 4QFY17, albeit on a low base. The EBITDA margin at 18.2% was down 450bps YoY (75bps miss). PAT stood at Rs 930mn, up ~2.2%YoY. In our view, 4QFY17 was a weak quarter for ALPM. Profitability reduced largely on account of higher R&D spend, US front end costs and staffing for the new facilities.