Lupin - March 2013 Results Preview - Motilal Oswal

- We expect Lupin's (LPC) 4QFY13E core top line to grow 34% YoY to INR22.73b, driven mainly by 48% YoY growth in advance market formulations (excl. one-off US sales). Domestic formulations are expected to grow 29% YoY.

- Core EBITDA would grow 84% YoY to INR4.43b, higher than the top line growth, over a low base of 4QFY12 and improved core operational performance in FY13. Core EBITDA margin is likely to increase 530bp YoY to 19.5%.

- We expect adjusted PAT at INR2.6b, against INR499m last year (which was impacted by significantly higher tax rate and subdued operational performance).

Significant internationalization without dilution of return ratios has been LPC's key achievement over the last five years. We expect this to sustain in the future. LPC aspires to reach the USD3b revenue mark by FY15. Achieving this target organically could be challenging (as implied top line CAGR for FY12-15E will be 30%); however, this can be achieved through potential acquisitions. We expect 24.3% EPS CAGR over FY12-15E. The stock trades at 20.1x FY14E and 16.7x FY15E EPS. Maintain Buy.

Source : Equity Bulls

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