Views on Indoco Remedies 3QFY2016 Results: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research - Pharma, Angel Broking) on Indoco Remedies 3QFY2016 Results:

"Indoco Remedies results were in line with expectations, on sales front, while net profit was lower on back of the lower than expected OPM's. On sales the company posted sales of INR 255cr (V/s INR 257cr estimated), a YoY growth of 19.6%. The growth during the quarter came in through exports (INR112.1cr) a YoY growth of 34.6%, while domestic markets posted sales of INR 141.9cr, a YoY growth of 9.8%. Exports growth during the period was aided by the regulated markets (INR 90.4cr) a YoY growth of 36.3% and emerging markets (INR 139.0cr) a YoY growth of 32.6%. The domestic formulation (INR 135.7cr) posted a YoY growth of 10.5%. On the operating front, the OPM's have come in at 15.4% (V/s 16.5% expected) and 18.3% in 3QFY2015. The margins have declined on back of 30.7% and 76.3% rise in employee expenditure and R&D expenditure respectively. Thus the, net profit came in at INR 20.4cr V/s INR 21.6cr in 3QFY2015, a YoY dip of 5.6%. This is against expectations of INR 25.4cr.

Also, during the quarter, USFDA audited Company's finished dosage (Plant I) at Goa. Establishment Inspection Reports (EIRs) for the Finished Dosage Plant I, Sterile Plant II and Finished Dosage Plant III at Goa are awaited. Overall, we are NEUTRAL on the stock."

Shares of INDOCO REMEDIES LTD. was last trading in BSE at Rs.323.1 as compared to the previous close of Rs. 315.95. The total number of shares traded during the day was 14493 in over 750 trades.

The stock hit an intraday high of Rs. 338.5 and intraday low of 311.45. The net turnover during the day was Rs. 4705554.

Source : Equity Bulls

Keywords