Unichem Lab hits lifetime high; surges over 15%

The stock zoomed 65% in past two months compared to 8.4% decline in the S&P BSE Sensex.

Unichem Laboratories has surged 17% to Rs 313, extending its two month rally on the National Stock Exchange (NSE) amid heavy volumes.

Trading volumes on the counter surged more than three-fold with a combined 1.13 million shares changing hands on the BSE and NSE till 12:07 PM.

The stock hit a lifetime high of Rs 317 on the NSE in intra-day trade today. It zoomed 65% in past two months from Rs 192 compared to 8.4% decline in the S&P BSE Sensex.

The pharmaceutical company had reported a standalone net profit of Rs 28.78 crore for the first quarter ended June 2015 (Q1) against Rs 30.20 crore in a year ago quarter. It had profit of Rs 9.82 crore in March 2015 quarter.

The company’s domestic business is vital as it contributes 56% of the consolidated revenue. In general, the growth in domestic formulation is mainly driven by three key elements -- increase in volume, price hike and introduction of new drugs in the market.

Despite the intense competition and pricing pressure in the domestic market in certain product segments, the rationalisation process undertaken by the management in India, stronger uptick in the US market and focus on key emerging markets like South Africa and Latin America are set to revive Unichem’s growth. The increasing growth trend seen in formulation business in recent earnings is likely to sustain and boost overall performance in the quarters going forward, said T. Ranvir Singh, AVP- Institutional Equity, Systematix Shares & Stocks, in a report dated July 30, 2015.