A recent entrant to the Nifty pack, Divi’s Labs is up 82 per cent year-to-date, and has almost doubled over the last one year.
MUMBAI: Shares of Divi’s Laboratories zoomed to an all-time high on Monday after the pharmaceutical major posted a robust set of Q2 numbers on Saturday.
Divi’s Labs rose as much as 6.2 per cent to an all-time high of Rs 3,438 on the BSE, while benchmark Sensex and Nifty were in euphoric mood too, as they scaled new highs as well.
A recent entrant to the Nifty pack, stock is up 82 per cent year-to-date, and has almost doubled over the last one year.
Divi’s Laboratories on Saturday posted a 45.63 per cent year-on-year (YoY) growth in consolidated net profit at Rs 519.59 crore for the quarter ended September 30.
Revenue from operations increased 21 per cent YoY to Rs 1,749.30 crore.
“We expect to complete the ongoing capex programs by end of the financial year. The company is taking up a new capex for an aggregate amount of Rs 400 crore for meeting new business opportunities in the custom synthesis projects and needed to be completed on fast track,” Divi’s Laboratories said.
Phillip Capital upgraded the stock to buy from neutral, and raised the target price to Rs 4,000 from Rs 2,750 earlier.
“Divis Q2 results were certainly much ahead of our estimates on all fronts but we are much excited by its multiple capacity expansion projects,” the brokerage said in a note.
“While the fresh CS projects adds value growth visibility and indicate about Chinese replace opportunity, the Kakinada site (a strategic one to focus on KSMs & early intermediates) to boost operating efficiency of existing USFDA approved sites and 4th greenfield site indicates the robust growth outlook,” it added.
Phillip Capital said these new capacity additions practically have eliminated the brokerage’s medium term concern of capacity constraint, emerging from recent robust growth momentum and provide a strong growth visibility over next five years.
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