Alembic Pharma Q1 Results Review - Execution Remains A Key: Dolat Capital
Launch momentum is critical for U.S. growth; domestic business growth to remain steady.
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Dolat Capital Report
Alembic Pharmaceuticals Ltd.’s Q1 FY24 showed a mixed bag performance with Ebitda margin below estimates while revenue and profit after tax above our estimates.
Revenues at Rs 14.9 billion (above estimate), grew by 17.7%/5.7% YoY/QoQ on higher international generic sales. Ebitda stood at Rs 1.99 billion inline (+73%YoY/- 11.0% QoQ).
Alembic Pharma's Ebitda margin at 13.4% was below estimates due to higher than expected operational and staff costs. Profit after tax stood at Rs 1.2 billion (above estimate) grew by 233.8% YoY due to lower depreciation expenses, tax and higher other income.
We upgrade our earnings per share estimates by 26.2%/23.1% in FY24E/FY25E assuming higher international generic and active pharma ingredient sales coupled with lower tax and lower depreciation cost.
With limited upside, we downgrade to 'Sell' with a revised target price of Rs 700.
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