Visit http://indiaer.blogspot.com/ for complete details Indoco Remedies
Indoco Remedies (Indoco) reported its 2QFY2011 results, which were ahead of our
estimates. Net sales came in at healthy `132cr (`95cr), up 38.7% yoy, as against our
estimates of `113cr. Growth was driven by the domestic formulation (up 37.2%, `88cr)
and export (up 39.0%, `40cr) segments. On the domestic front, growth was driven by the
respiratory, anti-infective and gastro segments. While on the export segment front, the
semi-regulated market grew by 140% to `8cr. The company reported gross margins of
54.2% (57.3%). Employee expenses increased by 28.2% yoy to `19cr (`15cr). The
company reported OPM of 13.4%, which was flat yoy. Indoco reported other income of
`3.1cr (`0.7cr), driven by exchange gain. While depreciation cost came in at `3cr. The
company reported net profit of `15cr (`9cr), up 65.9% yoy, driven by top-line growth.
Further, the company expanded its existing contract with Aspen and Watson, which would
commence meaningful contribution from FY2013. The stock is currently trading at 11.7x
FY2011E and 8.7x FY2012E earnings. The stock is under review.
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