Divi's Labs surges 14% on strong Q2 results; stock hits record high

The stock surged 14% to Rs 1,433 on the BSE in early morning trade on Monday, after reported a healthy 92% Y-o-Y jumped in net profit at Rs 3.98 billion in September quarter.

Shares of Divi’s Laboratories have surged 14% to Rs 1,433 per share on the BSE in early morning trade on Monday, after the company reported a healthy 92% year-on-year (Y-o-Y) jump in its net profit at Rs 3.98 billion in September quarter (Q2FY19), on back of strong revenue growth. The pharmaceutical company had profit of Rs 2.07 billion in year ago quarter.

The stock hit a record high today, surpassed its previous high of Rs 1,426 touched on September 26, 2018 on the BSE in intra-day trade.

The company’s revenue from operations during the quarter grew 45% at Rs 12.85 billion against Rs 8.88 billion in the corresponding quarter of previous fiscal. Forex gain for the quarter amounted to Rs 530 million as against a gain of Rs 110 million during the corresponding quarter of last year, Divi’s Labs said in a press release.

In order to cater to the increasing opportunities in generic and big pharma business, the company is taking up two brownfield projects with an aggregate investment of Rs 12 billion at  Visakhapatnam and in Bhuvangiri-Yadadri (erstwhile Nalgonda), Telangana. The work of these projects has already commenced and the projects are expected to be completed by end of the year 2019 barring unforeseen circumstances, it added.

The company said it is also taking up debottlenecking programs at Unit-1 as well as Unit-2 by investing an aggregate amount of Rs 3 billion –which would also create additional capacities for existing products.

At 09:29 am; Divi’s Labs was trading 13.5% higher at Rs 1,423 on the BSE, as compared to 0.11% rise in the S&P BSE Sensex. The trading volumes on the counter more than doubled with a combined 1.16 million equity shares changed hands on the BSE and NSE so far.