Divis Laboratories
Stock Snapshot
Price Performance
Vista Outlook
View Technicals Analysis →Basis of our Recommendation
Divi's Laboratories is strategically enhancing its capabilities in complex chemistry and custom synthesis, which are expected to drive revenue growth over the next 12-24 months. Management's focus on three major capex projects, coupled with a positive outlook for double-digit revenue growth in FY27, underscores the company's commitment to capitalizing on industry demand. However, challenges such as pricing pressures in the generic API segment and raw material cost volatility could impact margins. Vista's financial outlook reflects stable revenue growth and improving margins, supported by the company's strong performance in the custom synthesis segment. The favorable macro environment for Indian equities, alongside the ongoing global shift in supply chains, positions Divi's well for future growth. Key opportunities include the successful commercialization of new molecules and the expansion of the peptide business, while watchpoints include regulatory risks and geopolitical disruptions affecting raw material costs. Overall, Divi's Laboratories is poised for growth, but investors should remain vigilant regarding external pressures that may influence performance
Why We Like This Stock
- Management's focus on expanding capacity and capabilities in custom synthesis is expected to drive revenue growth
- The company anticipates double-digit revenue growth in FY27, supported by ongoing capex projects
- Favorable macro conditions and a shift in global supply chains enhance Divi's competitive position
Things To Watch Out For
- Pricing pressures in the generic API segment may limit margin expansion
- Raw material cost volatility and geopolitical disruptions could impact operational costs
- Regulatory risks associated with new product commercialization introduce uncertainty
Key Parameters
Financial Snapshot
| Actuals | Forecast | ||||
|---|---|---|---|---|---|
| FY24 | FY25 | FY26 | FY27 | FY28 | |
| Revenue (Cr.) | 7,845 | 9,360 | 10,560 | 11,835 | 13,828 |
| Profit Before Tax (Cr.) | 2,167 | 2,915 | 3,462 | 4,520 | 4,861 |
| PBT Margin | 27.6% | 31.1% | 3278.4% | 38.2% | 35.2% |
| Net Profit (Cr.) | 1,652 | 2,116 | 2,575 | 3,371 | 3,626 |
| Earnings Per Share | 62.3 | 79.8 | 97.2 | 127.2 | 136.8 |
Analyst Recommendations
| Broker | Recommendation | Target Price | Date |
|---|---|---|---|
| Choice Equity | ► Hold | 7,375 | 25-May-2026 |
| Citigroup | ▲ Buy | 11,700 | 03-Aug-2026 |
| Elara Capital | ▼ Reduce | 4,486 | 23-Apr-2026 |
| Goldman Sachs | ► Accumulate | 9,070 | 03-Aug-2026 |
| ICICI Securities | ▼ Reduce | 6,150 | 24-May-2026 |
| JPMorgan | ▲ Overweight | 9,100 | 03-Aug-2026 |
| Jeffries | ▲ Buy | 10,200 | 03-Aug-2026 |
| Kotak Securities | ▼ Sell | 6,925 | 03-Aug-2026 |
| Macguire | ▲ Outperform | 10,200 | 03-Aug-2026 |
| Moneycontrol | ► Equalweight | nan | 25-May-2026 |
| Morgan Stanley | ▲ Overweight | 7,904 | 25-May-2026 |
| Motilal Oswal | ► Neutral | 7,720 | 03-Aug-2026 |
| Prabhudas Liladhar | ► Accumulate | 8,600 | 03-Aug-2026 |
Company Overview
Show Company Profile
Divi's Laboratories Limited engages in the manufacture and sale of generic active pharmaceutical ingredients (APIs), intermediates, and nutraceuticals in India, North America, Asia, Europe, and internationally. The company also undertakes custom synthesis contract manufacturing services of APIs and intermediates; and supplies a range of carotenoids, such as beta carotene, astaxanthin, lycopene, and canthaxanthin, as well as lutein and vitamins used in the food, beverage, dietary supplement, pet food, and feed industries. It also exports its products. The company was formerly known as Divi's Research Center and changed its name to Divi's Laboratories Limited in 1994. Divi's Laboratories Limited was incorporated in 1990 and is based in Hyderabad, India.