- 02 Feb 2022
- ICICIdirect Research
Indoco domestic formulations drive Q3 growth
INDOCO - 361 Change: -3.80 (-1.04 %)News: Revenues grew 7.7% YoY to Rs.358 crore, driven by 15.2% YoY growth in domestic formulations to Rs.181.6 crore due to strong performance in anti-infective, gastro-intestinal, urological and respiratory therapeutic areas. Export formulations remained steady YoY at Rs.143.1 crore while APIs declined 32.2% YoY to Rs.19.7 crore. Gross margins was down 196 bps YoY to 69.6% amid rise in input cost. EBITDA margins improved 241 bps YoY to 20.5% on account of operational efficiency and cost control measures. EBITDA grew 22.1% YoY to Rs.73.5 crore. PAT for the quarter came in at Rs.33 crore, up 30.1% YoY.
View: Q3 topline was below our estimates mainly due to lower than expected sales in export formulations and APIs. Cost control measures offsetting the lower gross margins has resulted in better profitability this quarter. Company’s domestic business continues to focus on brand building with selective launches to boost growth. Indoco’s US business is expected to grow on back of commercialization of several ANDAs. 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
Impact: Positive