Prabhudas Lilladher's research report on Ipca Laboratories
IPCA Lab’s (IPCA) Q1 performance was muted impacted by higher overheads and weak GMs though export revenues recovered QoQ. We expect margins to recover as revenues scale up. Domestic business (45% of total sales) remained strong and it will continue to outperform IPM. Our FY23E and FY24E EBIDTA stands reduced by 17% and 7% to factor in lower margins.
At CMP, stock is trading at 23x FY24E P/E and factors in near term growth opportunities. We downgraded stock to Hold from ‘Buy’ with revised TP of Rs 1,010 (Rs 1,085 earlier) based on 23x FY24E earnings.
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