Divi's Laboratories said that the company has been able to have near-normal operations during the quarter and there was minimal impact due to COVID-19 pandemic
Divi’s Laboratories share price zoomed 16 per cent to hit a fresh 52-week of Rs 3228.05 apiece as the company reported 80.61 per cent on-year rise in the consolidated net profit at Rs 492.06 crore in the April-June quarter. The company had posted a profit of Rs 272.44 crore in the corresponding quarter of the previous fiscal. The drugmaker in a BSE filing said that the company has been able to have near-normal operations during the quarter and there was minimal impact due to COVID-19 pandemic. “We believe Divis Laboratories to be well-placed to benefit from renewed API as well as opportunity in CRAMS, supported by strong chemistry skill sets, manufacturing capacity/capabilities, and minimal compliance risk,” said Motilal Oswal Financial Services in a report. The brokerage firm has pegged a price target of Rs 3,350 apiece, a 20 per cent upside.
The total income of Divi’s Lab stood at Rs 1,747.80 crore during the first quarter as compared to a Rs 1,193.20 crore in the year-ago same period. At 11.15 AM, Divi’s Labs shares were trading 14.29 per cent higher at Rs 3,182 apiece, as compared to a 0.96 per cent rise in the benchmark S&P BSE Sensex. Research and brokerage firm Emkay Global Financial Services has recommended to buy the shares. It will take Divi’s Lab to jump 25.7 per cent from the previous close to touch the target price of Rs 3,500 per share. “We believe that the API sector has strong structural tailwinds as most global companies look to reduce their dependence on China and Divi’s Laboratories is the best positioned to benefit from this,” it added.
Divi’s Laboratories shares have climbed 120 per cent from its 52-week low of Rs 1,467 apiece. Brokerage firm ICICI Direct Research has given a buy rating to the stock. The company has earmarked an aggressive CAPEX of Rs 1,800 crore, over and above Rs 2,000 crore spent in the last five years. “We expect the full-blown impact of this massive investment to fructify from FY22 onwards. The company stays a quintessential play in the Indian API/CRAMs segment with its product offerings and execution prowess,” the brokerage firm added.
(The stock recommendation in this story is by the respective research and brokerage firm. Financial Express Online does not bear any responsibility for their investment advice. Please consult your investment advisor before investing.)