Divi's Laboratories Q2 result update!

Last updated: 10 Nov, 2020 | 04:03 pm

Divi's Laboratories Q2 result update!
  • Profit up 45.63%: Divi’s Laboratories recorded a 45.63% yearly growth in consolidated net profit at ₹519.59 crore for the quarter ended September 30. Net profit stood at ₹356.78 crore in the same quarter a year ago. Revenue from operations was up 21% yearly to ₹1,749.30 crore.
  • Margins Spike: EBITDA margin continued to spike on a sequential basis, for the quarter it stood at 43.5% as against 41% in June 2020 and 34% in March 2020 with Gross margin expanding to 67% from 63% sequentially. This was backed by the completion of backward integration of several leadership molecules. Management expects the Gross margin to be above the 60% range in the coming quarters. 
  • Segment-wise performance: Custom Synthesis which makes up 40% of the product mix grew 13% yearly while generic APIs recorded an 18% yearly growth. Revenues from COVID-related products remained negligible for the quarter.
  • Update on Capex: The ongoing Capex programs( of almost ₹1,800 crore) is expected to end of the financial year. In addition to this, the company announced new capex of ₹400 to cater to the upcoming requirement of its CS customers. 

Divi’s Lab has reported a robust set of numbers for this quarter. The company has been ongoing under a major Capex phase and major benefits of which would start accruing after FY21. Divi’s Lab has a strong order book with great traction from the CS segment. Margins are at multi-year highs and are expected to stay at such elevated levels with completion of several debottlenecking projects. It also continues to remain the market leader in select products. Taking all of these factors into account the company is all set to outperform in the coming years.

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