Divi's Laboratories - Q1FY21 First Cut - ICICI Securities

(CMP: Rs. 2784; MCap: Rs. 73913 crore)

Divi's Laboratories reported a stellar Q1FY21 performance. Q1 results were better than I-direct estimates on all fronts.

Q1FY21 Earnings Summary

- Revenues grew a robust 48.8% YoY to Rs. 1730 crore (I-direct estimate: Rs. 1303 crore)

- EBITDA margins expanded 716/847 bps YoY/QoQ to 40.5% (I-direct estimates of 32.5%) due to significantly better overall operational performance. Subsequently, EBITDA grew 80.8% YoY to Rs. 700 crore (I-direct estimate: Rs. 423 crore)

- Net profit grew 80.6% YoY to Rs. 492 crore (I-direct estimate: Rs. 307 crore) in-line with strong operational performance

In addition to the strong quarterly performance, the important narrative for Divi's is the ongoing mega capex it has undertaken a few quarters back and is likely to complete by H2FY21. This massive capex amounting to ~Rs. 1700 crore would further augment the capacities thus preparing the company to tap growing opportunities. We expect the full-blown impact of this investment to fructify from FY22 onwards.

We will be coming out with a detailed report soon.

Shares of DIVI'S LABORATORIES LTD. was last trading in BSE at Rs.2784.25 as compared to the previous close of Rs. 2739.85. The total number of shares traded during the day was 54230 in over 4984 trades.

The stock hit an intraday high of Rs. 2815 and intraday low of 2724.1. The net turnover during the day was Rs. 149917670.

Source : Equity Bulls

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