After releasing Q4 results, analysts show a divided outlook on Divis Labs. The report indicates potential opportunities and notable risks that investors should consider carefully.
Divi's Laboratories Limited
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Eicher Motors soars after positive management updates, approaching a record high on the BSE. Torrent Pharma gains post robust results. Sterlite Tech rises due to specific news, while Divi's Lab weakens. The BSE approaches a lifetime high, with GAIL trending as well.
Jefferies remains optimistic about Divi's Labs, maintaining a Buy rating with a target price of ₹7,950, driven by expectations in Custom Synthesis and nutraceuticals growth. However, concerns persist over weak generic sales and regulatory challenges on key Custom Synthesis projects, despite the company's promising growth outlook.
Divis Labs reported a 13.4% increase in Q4 net profit year-over-year, reaching INR 751 crore, with revenue growing by 9.5% to INR 2,831 crore. The board has proposed a dividend of INR 30 per share.
Kotak Securities maintains a 'Sell' recommendation for Divi's Labs, setting a target price of ₹5850, due to missing Q4 estimates driven by slower Customer Service Management growth. Although the company shows strong client engagement and promising peptide projects, concerns about high capital expenditure intensity and expensive valuations persist.
Divi's Labs anticipates double-digit revenue expansion, showing strong resilience even amidst industry uncertainties, with expectations of maintaining consistent profit margins throughout the challenges.
Divi's Lab reported a significant increase in Q4 net profit, reaching ₹7.5 billion compared to ₹6.6 billion last year. This rise is accompanied by an overall revenue growth of approximately 10%, moving from ₹25.85 billion to ₹28.3 billion YoY.
Divi's Laboratories experienced a substantial block trade on NSE, with 26,241 shares traded at a price of approximately Rs. 6,907 per share, resulting in a total value of around Rs. 18.1 crore.
Ajit Mishra from Religare Broking suggests investing in PFC, Tata Steel, and Divi's Laboratories for short-term gains due to promising technical patterns. The Nifty is facing resistance around 23,800-23,900, with support at 23,500. The market remains cautious due to high crude oil prices and foreign fund outflows.
Divi's Laboratories just executed a significant block trade on the NSE for approximately INR 17.1 crore. This trade consisted of 25,248 shares sold at INR 6,782.5 per share.