Indoco Remedies reach record high of Rs 530 in intra-day trade

Indoco Remedies shares witnessed a record high of a whopping Rs 529.70 after they added 20 per cent on the BSE in the intra-day trade on Thursday.

Indoco Remedies shares witnessed a record high of a whopping Rs 529.70 after they added 20 per cent on the BSE in the intra-day trade on Thursday. The company accounted for an enormous 40.2 per cent on year on year (YoY) basis and 26.7 per cent quarter on quarter (QoQ) development in revenue at Rs 386.8 crore for the quarter-end June 2021 (Q1FY22) on Wednesday in support of significant growth in the domestic market on the restraint of the Covid symptoms during the second mutant wave.

The stock of the company crossed its previous high of Rs 495 by July 2, 2021. At 11:42 am, stocks were trading at 15 per cent higher at Rs 507 on the BSE against the 0.29 per cent rise in the S&P BSE Sensex. Trading volumes on the counter went over a five-fold turn with a mix of 4.3 million equity shares having altered with on the NSE and BSE till the drafting of this report.

In Q1FY22, the company’s overall revenue from export formulations increased with 60.5 per cent YoY and 15.7 per cent QoQ to Rs 152.5 crore carried by strong growth in Regulated and Emerging markets, whereas domestic formulations significantly improved 46.3 per cent/54.5 per cent (YoY/QoQ) to Rs 215.1 crore.

The pharmaceutical company’s profit after tax (PAT) hiked at a doubling rate of Rs 39.6 crore from Rs 17.2 crore in the subsequent quarter of last fiscal. Ebitda (earnings before interest, taxes, depreciation, and amortization) margins widened by 107 bps/29 bps (YoY/QoQ) to 22.5 per cent in accordance with lower employee expenses.

Indoco has 9 domestic marketing divisions compiled with a rigid brand portfolio in several therapeutic divisions like Gastrointestinal, Respiratory, Anti-Infective, Stomatologicals, Ophthalmic, Nutritionals, Cardiovascular, Anti-Diabetics, Pain Management, Gynaecology etc.

“After going through rough patches in FY18- 20, where Indoco faced headwinds on the domestic front (structural issues, pandemic) and exports front (regulatory setbacks), the situation is returning to normalcy”, ICICI Securities said in a statement.

Indoco is expected to post strong FY22 top-line growth as Domestic sales normalize and grow amid opportunities arising out of post-Covid complications. Export formulations are also expected to post a robust growth on the back of a strong pipeline and visible launch schedule. Additionally, the management expects 80-90 bps margin improvement in FY22 to around 19 per cent. With better visibility, we expect the company to maintain consistency and generate strong free cash flow (FCF), the brokerage firm averred.

Source Business Standard
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