Divi’s Lab : Robust performance - Maintain Buy :Emkay,

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Divi’s Lab

Robust performance - Maintain Buy

BUY

CMP: Rs759                                        Target Price: Rs927

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n     Divi’s Q2FY12 performance was in-line with expectations with (a) Revenue at Rs3.66bn (up 43% YoY); (b) EBIDTA at Rs1.38bn (up 56% YoY)  & (c) APAT at Rs1.1bn (up 45% YoY)

n     Robust performance was on the back of commissioning of new SEZ plant at Vizag during June 2011

n     Going forward, improvement of capacity utilization at Vizag plant and ramp up in its carotenoids business will boost top-line and bottom-line

n     Strong quarter – Re-iterate Buy with a target price of Rs927 on the stock (20x FY13 EPS of Rs46.3)