Alembic Pharmaceuticals Ltd. share price target

ICICI Securities Ltd | Retail Equity Research Revenues grew 33% YoY to | 863 crore (I-direct estimate: | 817 crore) on account of 40% YoY growth in domestic formulations to | 331 crore (I-direct estimate: | 327 crore), up 79% YoY in international (ex-US) business to | 126 crore (I-direct estimate: | 69 crore) and 38.5% YoY growth in API segment to | 180 crore EBITDA margins improved 186 bps YoY to 17.5% but came in lowerthan I-direct estimate of 20.0% mainly due higher other expenditure. EBITDA grew 48.8% YoY to | 151 crore...

Margins Falter despite strong revenue growth: In Q1FY19, total revenues of Alembic Pharma increased by 33% YoY to Rs 8.6 bn (above our estimates Rs 8.0 bn). The Company's operating marginsincreased from 15.7% to 17.5% YoY (our estimates 20%).

Maintain NEUTRAL with a TP of Rs 560 (18x FY20E EPS). Alembic Pharma (ALPM) reported better numbers in their 1QFY19 result with revenue at Rs 8.6bn, up 34.6%YoY on account of a favourable low base. US revenues declined sequentially even after adjusting for one-off payment received in 4QFY18. Gross margin at 70.4% increased 130bpsQoQ due to a seasonally strong quarter.

28 July 2018 ALPMs 1QFY19 revenue increased significantly by ~33% YoY to INR8.6b (in-line), primarily driven by the non-US international and domestic businesses. Gross margin shrank 154bp YoY due to a change in product mix. However, EBITDA margin improved ~190bp YoY to 17.5% (est. of 20.9%), led by a decline in employee expense by ~530bp (as % of sales). This, however, was somewhat offset by higher other expense (+190bp). EBITDA grew ~49% YoY to INR1.5b (est. Higher depreciation and tax rate led to PAT growth of ~36% YoY to INR905m (below est.

In Q4FY18, total revenues of Alembic Pharma increased by 15% YoY to Rs8.5 bn (above our estimates Rs. 8.2 bn). The Company's operating marginsincreased from 18.2% to 20.3% YoY (our estimates 22%).

Maintain NEUTRAL with a revised TP of Rs 535 (18x FY20E EPS). Alembic Pharmas (ALPM) revenue grew 16%YoY to Rs 8.5bn, led by one off payment from the US marketing partner to the tune of US$ 5-6mn and higher volumes in rest of the US portfolio in 4QFY18. Although EBITDA grew 29% YoY to Rs 1.7bn, it declined 8% QoQ, largely driven by lower gross margin and higher R&D; spend (14% of sales). Reported PAT remained flat YoY at Rs 938mn with relatively higher tax rate in 4QFY18.

ICICI Securities Ltd | Retail Equity Research Revenues grew 15% YoY to | 853 crore (I-direct estimate: | 830 crore) mainly on account of 45% YoY growth in the US to | 290 crore (I-direct estimate: ~| 233 crore) led by one-off and volume driven growth. Excluding one-off, US sales grew 30% YoY EBITDA margins improved 215 bps YoY to 20.3% (I-direct estimate: 22.5%) mainly due to lower other expenditure. EBITDA increased 29% YoY to | 173 crore vis--vis I-direct estimate of | 187 crore...

Q3 revenue beat (~8% above our estimate) was driven by strong growth in India (up 14% YoY) and US (up 9% YoY/24% QoQ in cc terms). EBITDA margin was up 360 bps YoY to 22.3% on better sales mix and lower R&D; spends.

Alembic Pharmaceuticals (ALPM) is a vertically integrated company with US trajectory catching up again backed by increased capacities and refilling pipeline post a lull after gAbilify. We expect US to contribute 31.9% by FY20E backed by own front-end launches. Recovery in the domestic business and improving margins (increasing chronic mix) to support future growth....

ICICI Securities Ltd | Retail Equity Research Revenues grew 8% YoY to | 840 crore (I-direct estimate: | 755 crore) mainly on account of 14% YoY increase in domestic business to | 349 crore (I-direct estimate: | 364 crore). Export sales grew 3% YoY to | 311 crore (I-direct estimate: | 258 crore), led by 4% YoY growth in the US business to ~| 235 crore (I-direct estimate: ~| 192 crore) EBITDA margins improved 361 bps YoY to 22.3% (I-direct estimate: 21.8%) led by lower R&D; expenditure. EBITDA increased 29% YoY to...