Cadila Healthcare - 4QFY2017 Result Update - Angel Broking

For 4QFY2017, Cadila Healthcare posted lower than expected results. The sales came in at Rs. 2,418cr (v/s. Rs. 2,800cr expected) v/s. Rs. 2,270cr in 4QFY2016, a yoy growth of 6.5%. On the operating front, the EBITDA margin came in at 16.7% v/s. 21.4% (v/s. 15.7% expected) in 4QFY2016. The GPM's came in at 61.6% (v/s. 65.7% in 4QFY2016), which resulted in the dip in OPM. This, along with the 49.9% yoy increase in deprecation lead the Adj. net profit to register Rs. 386cr (v/s. Rs. 353cr expected) v/s. Rs. 568cr in 4QFY2016, a yoy de-growth of 32.1%. We remain Neutral.

Results lower than expected: The sales came in at Rs. 2,418cr (v/s. Rs. 2,800cr expected) v/s. Rs. 2,270cr in 4QFY2016, a yoy growth of 6.5%. The growth was mainly driven by the other business (Rs. 434cr), a yoy growth of 8.1%, while Formulation (Rs. 2,029.9cr), a yoy growth of 5.7%. On the operating front, the EBITDA margin came in at 16.7% v/s. 21.4% (v/s. 15.7% expected) in 4QFY2016. The GPM's came in at 61.6% (v/s. 65.7% in 4QFY2016), which resulted in the dip in OPM. This, along with the 49.9% yoy increase in deprecation lead the Adj. net profit to register Rs. 386cr (v/s. Rs. 353cr expected) v/s. Rs. 568cr in 4QFY2016, a yoy de-growth of 32.1%.

Outlook and valuation: We expect Cadila's net sales to post 19.8% CAGR to Rs. 13,228cr and EPS to report 21.0% CAGR to Rs. 21.3 over FY2017–19E. We maintain our Neutral rating on the stock.

Shares of CADILA HEALTHCARE LTD. was last trading in BSE at Rs.489.1 as compared to the previous close of Rs. 494.55. The total number of shares traded during the day was 83874 in over 1780 trades.

The stock hit an intraday high of Rs. 500 and intraday low of 486.1. The net turnover during the day was Rs. 41362648.

Source : Equity Bulls

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