Buy Ipca Laboratories; target of Rs 2200: Prabhudas Lilladher

Moneycontrol • 1 day ago

Original source

Key Investment Pillars

  • Strong revenue growth in export segment, up 32.5% YoY, driven by branded and generic businesses
  • Expected improvement in EBITDA margins, with a guidance of 100-125bps annual improvement
  • Domestic formulation and branded generic business continues to outperform, contributing 46% of revenues and ~70% of EBITDA
  • Recovery in API segment, higher margins ex Unichem, and steady growth in domestic formulation are key growth drivers

Thesis Validation Checklist

  • Watch for sustained growth in export formulations, particularly in branded and generic businesses
  • Monitor improvement in EBITDA margins, driven by operating leverage and cost discipline
  • Track the performance of domestic formulation and branded generic business, which is expected to continue outperforming
  • Keep an eye on the recovery in API segment and the impact of higher margins ex Unichem on overall profitability