Divi’s Laboratories Ltd is a Large-cap company with a market cap of 99,157.82 crore are working in the pharmaceutical sector. Divi’s Laboratories Ltd is a large valuation business with a market cap of 99,157.82 crore who works in the pharmaceutical industry. Divi’s is the world’s leading manufacturer of APIs (Active Pharmaceutical Ingredients), Intermediates and Registered Starting Ingredients, providing quality products to over 100 countries. The company is one of the top three API manufacturers in the world, as well as one of the top API firms in Hyderabad. Divi’s Laboratories is one of the debt-free multibagger stocks that has turned millionaire investors into millionaires in the long run.
Divi’s Laboratories Ltd . Share Price and Bonus Share History of
Divi’s Laboratories Ltd closed on Friday: 3,734.00 per share, up 0.027% from previous close 3,733. A total of 222,557 shares were traded in the stock on Friday. share price climbed 9 represents an all-time high of 41,388.89%, at the current market price on March 13, 2003.
Considering the fact that long term investments are now being considered as a smart option by many investors in the market, this company has really shown the value of long term investments. When the company was at the beginning of its growth phase that was in the year 2003, as the price was affordable to the public, if an investor had invested Rs. 1 lakh in this company, then he will have 11,111 shares of the company. Then in the first bonus announcement on July 30, 2009, in a 1:1 ratio, an investor’s shareholding increased to 22,222 which is a good indication of a profitable stock in the future considering the company’s work. Then in the second bonus announcement on 23 July 2015, a bonus ratio of 1:1 changed the share count of an investor in the company to 44,444 and quadrupled the number of initial shareholdings in the company.
Taking all the above data and putting effort in maths, we can conclude that if the investment in this company is almost three times Rs 25,240 (which is approximately Rs 1,00,000) will be fully invested in the initial period. The company till date which is for 18 years, an investor will get Rs. 25,240 per day without doing anything because 44,444 shares are now worth more than Rs. 16.59 crore which is also 100 times more than the initial investment of the investor.
Should you buy Divi’s Laboratories Ltd shares?
Research Analysts at Ashika Stock Broking Ltd said in a note that “Divij is a leading manufacturer of APIs, Intermediates, CS of Active Ingredients and Advanced Intermediates for Pharma MNCs, other specialty chemicals like Carotenoids and complex compounds like Peptides and Nucleotides. In CS, the company maintains a strong relationship with global large pharma players, while enjoying a significant market share in generics.General: CSM revenue-mix in FY2012 and 1QFY23 at 47%:53% and 47% respectively: 53%. Divi’s has identified six areas of growth: (1) established generics; (2) existing generics; (3) new generics; (4) Sartan API; (5) contrast media; and (6) C. .S Management remarks suggest healthy prospects on all these fronts.Furthermore, capex for the Kakinada Greenfield Project is of great importance, because of the impending China+1 strategy amid API’s US$20 billion opportunity which are due to be out of patent in FY 2013-25. Speedy Schedule for the same. Positive approval will be viewed positively.”
“Divij has a capital of Rs 935 crore in FY22 and Rs 87 crore in 1QFY23. As the company is operating at 80-85% capacity, it has huge available capacity for incremental demand. Divi’s has implemented various capacity expansion programs at its existing facilities apart from plant upgradation and infrastructure improvements. The company plans to spend Rs 2,000-3,000 crore in the next 2-3 years mainly on building greenfield facilities at Kakinada and Krishnapatnam ports. The capital expenditure is particularly important for Kakinada to take advantage of the ~US$20bn opportunity of API, which should not be patented by FY 23-25. However, capital expenditure on this has been put on hold due to lack of government approval. Any progress on this front will be very important, given the opportunities that lie ahead due to the China+1 strategy.”
“Despite strong revenue growth in CS & Nutraceutical segment, the company saw margin pressure in 1QFY23 on account of higher raw material and pricing pressure in generics. Management has reiterated margin pressure to sustain in the near-to-medium term and is directed for an EBITDA margin of 40% (including other income) for FY23. However, the long-term prospects remain strong due to efforts from backward integration, debottlenecking and utility upgradation, which will continue to deliver better margins. In the CMP, the stock trades at a P/E of 33.9x FY24E EPS and investors are advised to ‘Buy’ with a target of Rs. 4,110,” he further added.
The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
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