Indoco Remedies Q3 Results Review - Margin Weakness To Persist In Q4; Downgrade To Reduce: Yes Securities

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Yes Securities Report.Indoco Remedies Ltd.'s continues to be impacted by higher remediation costs and tepid domestic sales YoY as it weeds out slower performing brands. We await outcome of execution efforts of past few quarters as new launches in domestic business have been offset by a weak acute seasonality in current year.International exports have been driven by U.S. which continues to gain on back of strong generic tailwinds amid benign pricing environment. Europe business has been a stark disappointment as company would miss FY24 guidance.A subpar domestic performance, big European miss and one-off expense Rs 82 million results in a rather sharp earnings downgrade of ~30% for FY24 which has a cascading effect on FY25 estimates too. We bake in margin recovery next fiscal on back of 10-11% domestic growth and notably lower other expenses as remediation costs decline YoY.With domestic business weaker QoQ in Q4 and Q1 FY25 expected to be anyways better YoY, surprises appear limited in the near term. We introduce FY26 estimates; continue to value stock at 19 times FY25 earning per share for a revised target price Rs 350 (earlier Rs 405) and downgrade to Reduce from 'Add'..Click on the attachment to read the full report:.Axis Bank Shares Fall Over 6% After Q3 Margin Concern.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Indoco Remedies Q3 Results Review - Margin Weakness To Persist In Q4; Downgrade To Reduce: Yes Securities

Disappointment driven by weak domestic growth as sales rise 4% YoY, below IPM growth rate for the quarter

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