Total Income
INR 1,859 Cr
-20.7% YoY
Consolidated total income for Q1 FY24, down from INR 2,343 Cr in Q1 FY23.
DIVISLAB
Diversified
10 Aug 2023
Divislab Ltd — Q1 FY24
Divis Laboratories reported a consolidated total income of INR 1,859 crore for Q1 FY24, down from INR 2,343 crore in the same quarter last year, reflecting the absence of COVID-related demand and ongoing pricing pressures in generics.
Financial stats pending filing verification
2-Minute Summary
✦ AI-Generated from Full Transcript
Divis Laboratories reported a consolidated total income of INR 1,859 crore for Q1 FY24, down from INR 2,343 crore in the same quarter last year, reflecting the absence of COVID-related demand and ongoing pricing pressures in generics. PAT stood at INR 66 crore, impacted by lower sales and forex gains. Management highlighted easing raw material costs and logistics, with material consumption falling to 39% of sales. The custom synthesis segment (40% of mix) is progressing well with phase II/III projects and two large commercial projects ramping up. Contrast media and Sartans are key growth drivers, with MRI contrast media validation expected by FY24-end. Unit III greenfield project is on track with INR 1,500 crore initial investment, expected to contribute by mid-FY25. Management guided for a steady-state EBITDA margin of 35-40% and double-digit revenue growth over the medium term, excluding one-offs. Key risks include sustained pricing pressure in US/European generics and potential raw material volatility.
डिविस लैबोरेटरीज की पहली तिमाही (अप्रैल-जून 2023) की कुल आय 1,859 करोड़ रुपये रही, जो पिछले साल की समान तिमाही में 2,343 करोड़ रुपये थी। यह गिरावट कोविड से जुड़ी मांग खत्म होने और जेनेरिक दवाओं पर कीमतों के दबाव के कारण हुई। कंपनी का शुद्ध लाभ (PAT) 66 करोड़ रुपये रहा, जो कम बिक्री और विदेशी मुद्रा लाभ में कमी से प्रभावित हुआ। प्रबंधन ने कच्चे माल और लॉजिस्टिक्स की लागत कम होने की बात कही। कस्टम सिंथेसिस (दवा बनाने का विशेष काम) अच्छा चल रहा है, जिसमें दो बड़े प्रोजेक्ट शुरू हो रहे हैं। MRI कंट्रास्ट मीडिया और सार्टन दवाएं मुख्य वृद्धि के क्षेत्र हैं। यूनिट III का नया प्रोजेक्ट 1,500 करोड़ रुपये के निवेश से 2025 के मध्य तक शुरू होगा। कंपनी का लक्ष्य 35-40% का मुनाफा मार्जिन और दोहरे अंकों में आय वृद्धि है। जोखिमों में अमेरिका-यूरोप में जेनेरिक दवाओं पर कीमत दबाव और कच्चे माल की कीमतों में उतार-चढ़ाव शामिल है।
Key Numbers
Material Consumption % of Sales
39%
-300bps QoQ
Material consumption as a percentage of sales revenue, down from 42% in Q4 FY23.
Generics to Custom Synthesis Mix
60:40
Stable
Revenue split between generics (60%) and custom synthesis (40%) for the quarter.
Cash on Books
INR 4,208 Cr
Stable
Cash and cash equivalents as of March 31, 2023.
Management Guidance
Steady-state EBITDA margin of 35-40%
Management expects EBITDA margins to stabilize in the 35-40% range over the long term, excluding COVID-related distortions.
Management guidance marginsDouble-digit revenue growth over medium term
Management anticipates double-digit revenue growth going forward, driven by custom synthesis, contrast media, and Sartans.
Management guidance revenueUnit III greenfield project to commercialize by mid-FY25
The Unit III project in Kakinada, with an initial investment of INR 1,500 crore, is expected to start commercial production by mid-2025.
Management guidance expansionMRI contrast media validation by end of FY24
Validation for some MRI contrast media products is expected to be completed by the end of the current financial year, enabling customer sampling.
Management guidance growthKey Risks
Sustained pricing pressure in US/European generics
Management acknowledged potential impact of price pressures in US and European markets on operating margins, though they remain optimistic.
medium · management_commentaryRaw material price volatility
While raw material prices are currently softening, management noted that price variations could recur, especially for solvents like acetonitrile.
medium · analyst_questionDependence on custom synthesis project ramp-up
Custom synthesis growth depends on customer approvals and project timelines, which are uncertain and not quarter-to-quarter predictable.
medium · management_commentaryNotable Quotes
We see a stable, probably steady 35%-40%. I think that's what we can comfortably say.
Slow, steady, consistent, and debt-free. These are our models.
The high cost inventory was being reflected at that time, and that's why there has been a higher raw material consumption at that point in time. The materials that have been procured at higher price have been diminishing.
Frequently Asked Questions
What was Divislab's revenue in Q1 FY24?
Divislab reported revenue of — in Q1 FY24, representing a — change compared to the same quarter last year.
What guidance did Divislab management give for FY25?
Steady-state EBITDA margin of 35-40%: Management expects EBITDA margins to stabilize in the 35-40% range over the long term, excluding COVID-related distortions. Double-digit revenue growth over medium term: Management anticipates double-digit revenue growth going forward, driven by custom synthesis, contrast media, and Sartans. Unit III greenfield project to commercialize by mid-FY25: The Unit III project in Kakinada, with an initial investment of INR 1,500 crore, is expected to start commercial production by mid-2025. MRI contrast media validation by end of FY24: Validation for some MRI contrast media products is expected to be completed by the end of the current financial year, enabling customer sampling.
What are the key risks for Divislab in FY25?
Key risks include Sustained pricing pressure in US/European generics — Management acknowledged potential impact of price pressures in US and European markets on operating margins, though they remain optimistic.; Raw material price volatility — While raw material prices are currently softening, management noted that price variations could recur, especially for solvents like acetonitrile.; Dependence on custom synthesis project ramp-up — Custom synthesis growth depends on customer approvals and project timelines, which are uncertain and not quarter-to-quarter predictable..
Did Divislab meet its previous quarter's guidance?
Scorecard data is being built as historical quarters are processed.
Where can I read the full Divislab Q1 FY24 concall transcript?
The full earnings conference call transcript or source release is available on the linked source material. This page provides an AI-generated summary with filing verification status shown on the financial stats.