External broker reports(aggregated public sources), Motilal Oswal Financial Services Limited

Motilal Oswal

External broker reports(aggregated public sources)

Motilal Oswal Financial Services Limited

Motilal Oswal Financial Services Limited is an Indian diversified financial services firm offering a range of financial products and services. 

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Equity Bottom-Up

<ul><li>DIVI delivered an earnings miss in 2QFY23. Reduced traction in Custom Synthesis (CS), coupled with lower operating leverage, resulted in an earnings decline for the first time after 12 quarters of a strong performance.</li><li>We cut our FY23/FY24 estimates by 18%, factoring in: a) a deceleration in the CS business and commercial benefit from certain newer projects on completion of clinical trials (FY24 onwards), b) moderation in the API business, and c) delayed scale-up in the Nutraceuticals business, despite a capacity expansion.</li><li>We also lower our P/E multiple to 30x from 33x to factor in lower visibility on Kakinada capex, considering capex to be one of the leading growth indicators for DIVI.</li></ul><p><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></p>

DIVI delivered an earnings miss in 2QFY23. Reduced traction in Custom Synthesis (CS), coupled with lower operating leverage, resulted in an earnings decline for the first time after 12 quarters of a strong performance.We cut our FY23/FY24 estimates by 18%, factoring in: a) a deceleration in the CS business and commercial benefit from certain newer projects on completion of clinical trials (FY24 onwards), b) moderation in the API business, and c) delayed scale-up in the Nutraceuticals business, despite a capacity expansion.We also lower our P/E multiple to 30x from 33x to factor in lower visibility on Kakinada capex, considering capex to be one of the leading growth indicators for DIVI.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Divi’s Laboratories - Miss in 2QFY23; Growth Factors to Face Softness over Medium Term

Global Healthcare Analyst

Tina Banerjee

<ul>
<li>
<a href="https://www.smartkarma.com/entities/piramal-enterprises-ltd" target="_blank" data-smartkarma-citation="entities:14158:1" rel="noopener">Piramal Enterprises (PIEL IN)</a> obtained shareholders nod for demerging its pharma business and consolidated under Piramal Pharma Limited (PPL). Later, PPL will be listed on India stock exchange.</li>
<li>PPL has a differentiated pharmaceutical business model, with three business verticals. CDMO, the largest revenue contributor, has track record of consistent above-market growth due to its niche and complex capabilities.  </li>
<li>Listed as a separate entity, PPL will see multiple expansion and command premium valuation over other Indian generic drug makers, due to its niche and limited competition portfolio.</li>
</ul>



Piramal Enterprises (PIEL IN) obtained shareholders nod for demerging its pharma business and consolidated under Piramal Pharma Limited (PPL). Later, PPL will be listed on India stock exchange.
PPL has a differentiated pharmaceutical business model, with three business verticals. CDMO, the largest revenue contributor, has track record of consistent above-market growth due to its niche and complex capabilities.  
Listed as a separate entity, PPL will see multiple expansion and command premium valuation over other Indian generic drug makers, due to its niche and limited competition portfolio.


Piramal Enterprises (PIEL IN): Demerger to Create a Differentiated and Niche Pharmaceutical Business

<p>DIVI delivered in line 2QFY22 earnings led by strong offtake in the Custom Synthesis (CS) segment and ramp up in the Nutraceuticals segment. It has enough capacity to cater to upcoming demand of Molnupiravir. We reduce our FY22E/FY23E EPS estimate by 5%/2% to factor in moderation in Generic API prospects over the near to medium term and increased OPEX related to expanded capacity. We roll our TP for 12-months forward earnings and continue to value DIVI at 36x to arrive at TP of INR6,050.</p><div class="content-highlight"><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></div>

DIVI delivered in line 2QFY22 earnings led by strong offtake in the Custom Synthesis (CS) segment and ramp up in the Nutraceuticals segment. It has enough capacity to cater to upcoming demand of Molnupiravir. We reduce our FY22E/FY23E EPS estimate by 5%/2% to factor in moderation in Generic API prospects over the near to medium term and increased OPEX related to expanded capacity. We roll our TP for 12-months forward earnings and continue to value DIVI at 36x to arrive at TP of INR6,050.Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

Custom Synthesis/Nutraceuticals drive earnings growth

Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<p>The Hang Seng, EURO STOXX 50, MSCI ACWI ex-US, and MSCI EAFE display bearish short-term inflections. Additionally, 10-year yields in the US and Germany are breaking down below key support. These deteriorating market dynamics raise concerns of a deeper pullback, however other indicators remain largely positive. As a result, we continue to see a mixed, but overall constructive market. Actionable themes highlighted in today's report include Health Care and Real Estate.</p>

The Hang Seng, EURO STOXX 50, MSCI ACWI ex-US, and MSCI EAFE display bearish short-term inflections. Additionally, 10-year yields in the US and Germany are breaking down below key support. These deteriorating market dynamics raise concerns of a deeper pullback, however other indicators remain largely positive. As a result, we continue to see a mixed, but overall constructive market. Actionable themes highlighted in today's report include Health Care and Real Estate.

Global Equity Strategy: Mixed Market Environment Continues As Yields Break Down

<p>DIVI delivered in line 4QFY21 earnings. It ended FY21 on a strong note, with 29%/57%/54% YoY growth in sales/EBITDA/PAT. New product development, ongoing capex, and strong prospects in Custom Synthesis (CS) provides...</p><div class="content-highlight"><em>Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.</em></div>

DIVI delivered in line 4QFY21 earnings. It ended FY21 on a strong note, with 29%/57%/54% YoY growth in sales/EBITDA/PAT. New product development, ongoing capex, and strong prospects in Custom Synthesis (CS) provides...Content is external broker report sourced from online content aggregator through publicly available sources and is displayed below for general informational purposes only. Refer full disclaimer below.

DIVISLAB: DIVI delivered in line 4QFY21 earnings

India

Divi's Laboratories Ltd. manufactures pharmaceutical products which include generic drugs and their intermediates. The Company also undertakes contract research activities for other pharmaceutical companies.

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Divi's Laboratories (DIVI IN)

Divi’s Laboratories - Miss in 2QFY23; Growth Factors to Face Softness over Medium Term

DIVI delivered an earnings miss in 2QFY23. Reduced traction in Custom Synthesis (CS), coupled with lower operating leverage resulted in an earnings...

Motilal Oswal

Piramal Enterprises (PIEL IN): Demerger to Create a Differentiated and Niche Pharmaceutical Business

Shareholders’ nod for the proposed demerger will create pharmaceutical-focused listed entity, which should pave the way for value unlocking due to...

Tina Banerjee

Custom Synthesis/Nutraceuticals drive earnings growth

DIVI delivered in line 2QFY22 earnings led by strong offtake in the Custom Synthesis (CS) segment and ramp up in the Nutraceuticals segment. It has...

Motilal Oswal

Global Equity Strategy: Mixed Market Environment Continues As Yields Break Down

The Hang Seng, EURO STOXX 50, MSCI ACWI ex-US, and MSCI EAFE display bearish short-term inflections and 10-year yields in the US and Germany are...

Vermilion Research

DIVISLAB: DIVI delivered in line 4QFY21 earnings

DIVI delivered in line 4QFY21 earnings. It ended FY21 on a strong note, with 29%/57%/54% YoY growth in sales/EBITDA/PAT. New product development,...

Motilal Oswal

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