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Alembic Pharmaceuticals Ltd | Q4FY13 First Cut Analysis




IndiaNivesh Securities Pvt Ltd


02 May 2013





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Alembic Pharmaceuticals Ltd.(APL) …Ahead of estimates on all fronts Revenue marginally above estimates on account of higher sales from International generics business: APL’s Q4FY13 revenue was marginally above estimates & grew 10.5% y-o-y (2.1% q-o-q) to Rs 3.77 billion (V/s INSPL estimates = Rs 3.75 billion) in Q4FY13 on the back of 54% y-o-y growth from International generics business linked with Desvenlafaxine supply to US market along with its partner Ranbaxy at the end of March 2013 & partial commencement of new formulation facility. APL’s domestic formulation business grew 12.5% y-o-y on the back of healthy growth in specialty business partially offset by slow growth of only 3% y-o-y in anti-infective, cold & cough segment. Overall growth was partially offset by 11% y-o-y decline in API business. Valuation: At CMP of Rs 117, the stock is trading at P/E multiple of 12.4x of FY14E & 9.4x of FY15E earnings estimates. We have recommend buy on the stock at prevailing price of Rs 49 in our “initiating coverage report released on 7th June 2012” with the target price of Rs 79 & further updated to Rs 109, which has been achieved. Current performance of the company was above estimates & anticipating full fledged commencement of new formulation facility & management’s guidance of above 30% y-o-y growth from international regulated market, we continue to maintain positive view on the stock. However, we intend to come out with detailed analysis & revised target price after attending con call, which is scheduled for tomorrow, date 03 May 2013 at 4PM, +91-22- 30650102.

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