Divi Pharma shares slide 4% on Q4 earnings report

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Divi Pharma shares slide 4% on Q4 earnings report

Shares of BSE hit a 52 week low of Rs 3,708, down 4 per cent on Tuesday s trade. The stock fell 14 per cent in the past two trading days despite the pharmaceutical company delivering better-than-expected March quarter Q 4 FY 22 results, with the highest quarterly sales and earnings before interest, taxes, depreciation and amortization EBITDA. The board recommended a dividend of Rs 30 per share of face value of Rs 2 each. For the financial year 2021 - 22, there were 1500 per cent.

The stock fell below its previous low of Rs 3,790 touched on January 24, 2022.

The company's consolidated revenues increased 41 per cent year on year to Rs 2,518 crore. EBITDA grew 54 per cent YoY to Rs 1,104 crore, while margins improved by 380 bps YoY to 43.9 per cent due to lower employee and other expenditure. The net profit grew by 78 per cent YoY to Rs 895 crore. The performance was largely led by strong traction in the Custom Synthesis CS segment.

Motilal Oswal Financial Services lowered its FY 23 FY 24 EPS estimate by 11 per cent, due to reduced sales of COVID-related products, due to the low number of cases globally, a gradual increase in growth in the Generics segment, and the delay in implementation of Kakinada capex.

More than a strong quarterly performance, the important narrative for Divi is its unprecedented capex plans to further expand capacities in addition to preparing for growing opportunities due to China plus one factor. A capex of around 2,000 crore including greenfield Kakinada plant is planned over the next two years to take a chunk of the US $20 billion opportunity of APIs going off-patent over FY 23 -- 25, according to ICICI Securities. The brokerage firm said that Divi s remains a quintessential play on the Indian API CRAMs segment with its product offerings and execution prowess.