Cadila Healthcare - 4QFY2016 Result Update - Angel Broking

For 4QFY2016, Cadila Healthcare (Cadila) posted a robust performance on the net profit front while sales came in lower than expected. Sales came in at Rs. 2,376cr (V/s Rs. 2,400cr expected), growing by 5.7% yoy. On the operating front, the OPM came in at 21.4% V/s 21.1% expected and V/s 20.2% in 4QFY2015.

The expansion in the OPM was driven by expansion in the GPM to 65.4% (V/s 64.3% in 4QFY2015) despite increase in staff expenditure and other expenditure by 13.7% yoy 3.8% yoy respectively. R&D expenditure during the quarter came in at 7.6% V/s 8.4% of sales in 4QFY2015. The Adj. net profit came in at Rs. 388cr V/s Rs. 373cr expected and V/s Rs. 351cr in 4QFY2015, ie a yoy growth of 10.6%. We maintain our Buy on the stock.

Results better than expected at the net profit level: For 4QFY2016, sales came in at Rs. 2,342cr (V/s Rs. 2,400cr expected), growing by 5.7% yoy. On the operating front, the OPM came in at 21.4% V/s 21.1% expected and V/s 20.2% in 4QFY2015. The expansion in the OPM was driven by expansion in the GPM to 65.4% (V/s 64.3% in 4QFY2015) and despite 13.7% yoy growth in the staff expenditure and 3.8% yoy rise in other expenditure. R&D expenditure during the quarter came in at 7.6% V/s 8.4% of sales in 4QFY2015. The Adj. net profit came in at Rs. 388cr V/s Rs. 351cr in 4QFY2015, a yoy growth of 10.6%.

Outlook and valuation: We expect Cadila's net sales to post a 17.8% CAGR to Rs. 13,148cr and EPS to report a 15.8% CAGR to Rs. 20.0 over FY2016-18E. We maintain our Buy rating on the stock.

Shares of CADILA HEALTHCARE LTD. was last trading in BSE at Rs.324.2 as compared to the previous close of Rs. 333.6. The total number of shares traded during the day was 136794 in over 5794 trades.

The stock hit an intraday high of Rs. 330.5 and intraday low of 322.4. The net turnover during the day was Rs. 44424925.

Source : Equity Bulls

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