Views on Indoco Remedies Ltd 1QFY2018 Results: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research- Pharma, Angel Broking):

"Indoco Remedies like other pharmaceuticals companies posted bad set of numbers. Sales came in at INR 204cr V/s INR214cr expected and V/s INR253cr in 1QFY2017, a YoY de-growth of 19.2%. The company witnessed a disruptive 1QFY2018, with domestic as well International sales getting affected adversely due to GST implementation in India and voluntary stoppage of ophthalmic product supplies to US respectively. The formulation sales (INR185.7cr; 90.9% of sales in 1QFY2018), posted a dip of 20.7% YoY. The domestic formulation sales (INR99.7cr), a dip of 29.7% YoY. The International formulation sales (INR86.0cr), a YoY dip of 6.9%. The API sales (INR14.9cr), posted a YoY dip of 15.1%.

On operating front, the EBITDA margins came in at (1.7%) V/s (0.9%) expected V/s 14.7% in 1QFY2017, mainly on back of lower than expected sales during the quarter. Gross margins came in at 65.2% V/s 64.8% in 1QFY2017; while R&D expenses were 6.6% of sales in 1QFY2018 V/s 4.7% of sales in 1QFY2017. Thus, the PAT came in at INR (21.7)cr V/s INR (13.8)cr expected V/s INR19.7cr in 1QFY2017. We maintain our SELL rating on the stock, with a price target of INR153."

Shares of INDOCO REMEDIES LTD. was last trading in BSE at Rs.192.4 as compared to the previous close of Rs. 188.55. The total number of shares traded during the day was 12184 in over 307 trades.

The stock hit an intraday high of Rs. 194 and intraday low of 181. The net turnover during the day was Rs. 2298406.

Source : Equity Bulls

Keywords