Laurus Labs Why Buy?
Efficiency Prompts
Global Expansion solid formulations business
n Largest ARV and API producer
n Sizeable ANDA pipeline
n Transitioning from API to an oral
Watch Out For
n Ability to deliver double-digit growth
in the ARV and oncology space
The scrip is trading at an attractive one-year
forward earnings, says Khushboo Balani
n Managing pricing pressure in the US
market
n Over-depended on top-5 products
Financials
BSE Sensex (Points)
Laurus Labs (`)
Net sales (` crore)
133.27
150
FY18
FY17
FY16
100
2,069.00
1,904.65
1,777.58
OP (` crore)
96.35
50
Note : Larsen & Toubro had announced bonus in 2017 in the ratio
of 1:2.The share has been quoting ex-bonus from July 13, 2017.
0
19 Dec 2016
L
aurus Labs supplies APIs
to nine of the world’s top
ten pharmaceutical players
(Aspen, Aurobindo, Cipla
etc). The firm’s emphasis on cost
efficiency, quality control, a higher off-
take by global procurement agencies,
and a qualified management have
been instrumental in driving growth.
Laurus’ emphasis on automation
and quality control has ensured
a good record. In August 2017,
USFDA inspected its API facilities
at Visakhapatnam and granted an
establishment inspection report (EIR).
It received two Form 483 observations
for unit I and unit III, which
were procedural in nature. It has
completed USFDA audit without any
observations at unit II (formulations).
Siddhartha Khemka, who is Head
of Research (Retail) at Motilal Oswal
Financial Services says, the firm’s
strong presence in the anti-retroviral
17 May 2018
(ARV) business and forward
integration into the formulations
business have cemented its position
as a niche pharma player. However,
on the back of below-than-expected
Q3FY18 performance and a weak
sentiment for the sector, its stock
hit a 52-week low in February. It
has since recovered after the final
approval for its maiden launch in the
US for Tenofovir Disoproxil Fumarate
(TDF). But this good news is not
the only reason why the stock could
climb in the coming year.
The TDF approval has stirred
optimism around its ANDA pipeline.
Laurus’s spending on R&D has
grown from 3.74 per cent of total
sales in