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Divi's Laboratories — Q3 FY24
Divis Laboratories reported a steady Q3 FY24 with PAT of INR 358 crore on total income of INR 1,950 crore.
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Divis Laboratories reported a steady Q3 FY24 with PAT of INR 358 crore on total income of INR 1,950 crore. The custom synthesis segment improved to 46% of revenue, driven by two large projects entering full-scale production. Generic API faced pricing pressure but market share gains of 3-5% in key products were noted. Management guided for double-digit revenue growth and expects Kakinada plant to commence production by Q2 FY25, with commercialization by Q3 FY25 subject to regulatory approvals. GLP-1 building block qualifications are underway with commercial benefits expected from 2025. Risks include Red Sea crisis impacting freight costs and potential delays in customer regulatory approvals.
डिविस लैबोरेटरीज ने तीसरी तिमाही में 1,950 करोड़ रुपये की कमाई पर 358 करोड़ रुपये का शुद्ध लाभ कमाया। कस्टम सिंथेसिस (ग्राहकों के लिए खास दवा बनाने का काम) से आय बढ़कर 46% हो गई, क्योंकि दो बड़े प्रोजेक्ट पूरी तरह से उत्पादन में आ गए। जेनेरिक एपीआई (सामान्य दवाओं का कच्चा माल) पर कीमत दबाव था, लेकिन कुछ जरूरी उत्पादों में बाजार हिस्सेदारी 3-5% बढ़ी। कंपनी को उम्मीद है कि अगले साल सितंबर तक काकीनाडा प्लांट शुरू हो जाएगा और दिसंबर तक बिक्री शुरू होगी। GLP-1 (डायबिटीज और मोटापे की दवा) के लिए काम चल रहा है, 2025 से फायदा मिलेगा। लाल सागर संकट से माल ढुलाई खर्च बढ़ सकता है और ग्राहकों की मंजूरी में देरी का जोखिम है।
Promises0 met · 1 missedRisks3 trackedTranscriptfull text
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Red Sea crisis impacting freight costs and supply chain
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Transcript
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Read Transcript →Quarter Snapshot
Custom Synthesis Revenue Share
46%
+6pp QoQ
Custom synthesis share increased from 40% in Q2 to 46% in Q3, driven by two large projects.
Capacity Utilization
80%
Overall capacity utilization for the quarter was around 80%, as stated by management.
Kakinada Capex Spent
INR 458 Cr
Total spend on Kakinada project during FY24 as of Dec 31, 2023.
Nutraceutical Revenue
INR 153 Cr
Nutraceutical segment revenue for Q3 FY24, growing at ~10% YoY.
What Changed vs Last Quarter
NEW
Double-digit revenue growth expected year-on-year
Management expects double-digit revenue growth for FY25, driven by custom synthesis ramp-up and new generic launches.
NEW
GLP-1 building block commercial benefits from 2025
Qualifications for GLP-1 building blocks with innovators are ongoing; commercial revenues expected from 2025.
UPDATED
Kakinada plant production to start Q2 FY25, commercialization by Q3 FY25
Phase I of Kakinada greenfield project will commence production in Q2 FY25, with commercial supplies expected by Q3 FY25 subject to regulatory approvals.
DROPPED
Custom synthesis growth from Big Pharma projects in coming quarters
Two large custom synthesis projects are now at full production capacity, with revenue contribution expected to be visible in the next quarters.
DROPPED
Peptide building blocks revenue visible by FY25
Revenue from GLP-1 agonist peptide building blocks is expected to start in FY25, with larger volumes thereafter.
DROPPED
Contrast media gadolinium product supply likely in FY25
Gadolinium-based contrast media process is in final stages; customer approvals and supplies are expected more towards FY25.
NEW RISK
Red Sea crisis impacting freight costs and supply chain
Management noted a 30% spike in freight costs due to rerouting and war risk insurance, which could pressure margins in coming quarters.
NEW RISK
Regulatory approval delays for customer projects
Several custom synthesis and generic projects are awaiting FDA/EU approvals, which are outside Divi's control and could delay revenue recognition.
RISK GONE
Inventory write-offs from COVID leftovers
INR 20 crore inventory write-off was taken for COVID-related materials, indicating potential for further write-offs if demand does not recover.
RISK GONE
Custom synthesis growth not yet visible YoY
Despite management optimism, custom synthesis revenue appears flat YoY when adjusting for COVID sales, raising questions about growth trajectory.
RISK GONE
Geopolitical and economic fluctuations
Management cited potential consequences from ongoing geopolitical and economic fluctuations, though no specific impact was quantified.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q2 FY24
Management acknowledged pricing pressure in large volume generics due to inventory destocking by mid-to-small players, which could last up to two years.
Fast read
Guidance and risk preview
Management expects double-digit revenue growth for FY25, driven by custom synthesis ramp-up and new generic launches.
Management noted a 30% spike in freight costs due to rerouting and war risk insurance, which could pressure margins in coming quarters.
View Risks →