Divi’s Laboratories entered the elite club of companies with a market capitalisation (market-cap) of Rs 1 trillion.
The move came after the firm’s stock price hit a new high of Rs 3,832, up 3 per cent, on Thursday.
Investors have been buying into Divi’s Labs on strong earnings visibility from its aggressive capax plan.
The company has been witnessing strong demand for both active pharmaceutical ingredients (API) and custom synthesis operations.
About Company
Divi’s Laboratories, one of the world’s largest generic active pharmaceutical ingredient manufacturers, is also the best performer on the Nifty 50 so far this year, gaining more than 100%.
It’s the only Nifty 50 constituent to have witnessed a twofold jump in its stock price this year as the benchmarks rebounded to scale new peaks.
Company’s Financial
For the September quarter, the company’s revenue grew 21% year-on-year to ₹1,750 crore.
Generic sales rose 23% while costom synthesis sales advanced 18%.
Gross margins expanded 820 basis points while profit increased 47% to ₹530 crore.
2nd firm in his sector to cross the milestone
It is the second most valued pharma company enter the elite club after Sun Pharmaceutical Industries, which has market-cap of Rs 1.40 trillion.
Divis Labs stands at the 30th position among Indian companies having market-cap of over Rs 1 trillion (including all sectors).
Comment from broking firm ShareKhan
“We expect Divi’s to reap benefits of backward integration, capacity expansion, and emerging opportunities in the API and custom synthesis space.
Strong earnings visibility, almost zero debt, and strong return ratios bode well from a growth perspective. Moreover, the company does not have any pending regulatory hurdles, which is a key positive.”
Stock Market
The stock opened at Rs 3,719 on BSE against the previous close of Rs 3,719.45 and touched a high of Rs 3,847.90 in the trade so far.
The pharma sector has been among the top beneficiaries of the COVID-19 pandemic and the stock of Divi’s has been among the top performers of the pharma pack.
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