Q3FY21 Result Update - Laurus Labs - ICICI Direct

Q3 revenues grew ~76.6% to Rs. 1288 crore amid strong growth across segments driven by 103.5% YoY jump in API segment to Rs. 731 crore amid strong traction in antiviral APIs to Rs. 568 crore (2.65x YoY) driven by higher volume of first-line products. Formulations revenue grew 47.2% YoY to Rs. 430 crore on the back of higher tender business from LMIC and higher volumes from US, Europe. CRAMS business grew 62.4% YoY to Rs. 127 crore. EBITDA margins improved 1278 bps to 33.1% due to better product mix and improved operating leverage. Subsequently, EBITDA grew 187.7% YoY to Rs. 426 crore. PAT was up 271.3% YoY at Rs. 273 crore.

Valuation & Outlook

Q3 results were above I-direct estimates on all fronts. Laurus is well poised to follow the success story of some leading CDMO players backed by strong chemistry and integrated model. Elsewhere, formulations are expected to grow amid ramp up and new launches (e.g. TLE400) in LMIC and launches in the US. Other APIs are expected to be driven by a strong order book and capacity addition. Besides continuous improvement in the financial performances, the company is evolving as a strong vertically integrated player with strong order book visibility, improving margin profile, strengthening return ratios and healthy FCF generation. We maintain BUY rating with a target price of Rs. 440 (vs. Rs. 390 earlier) based on 18x of FY23E EPS of 24.4.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_Laurus_Q3FY21.pdf

Shares of Laurus Labs Ltd was last trading in BSE at Rs.345.2 as compared to the previous close of Rs. 357.75. The total number of shares traded during the day was 255493 in over 6110 trades.

The stock hit an intraday high of Rs. 374.9 and intraday low of 340. The net turnover during the day was Rs. 90879181.

Source : Equity Bulls

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