The stock of Granules India, an active ingredients and drug formulations maker, has rallied almost 46 percent from our last buy call given in March 2019, thanks to its favourable product mix and healthy show in the US market.
The company’s large CAPEX spend over the past three years has started to pay off.
Granules India has improved its R&D capabilities, which is now aiding revenue growth.
In the nine months ended 2019-20, Granules’ consolidated revenue grew by 20 percent (year-on-year) to ₹1,999 crore and net profit was up by 41 percent at ₹243 crores. The company’s operating margin stood at 22 percent during the period.
The growth prospects of the company over the medium-to-long run remain healthy, thanks to changing the product mix in favor of the high-margin formulations business, optimal utilization of increased capacities and scaling up of US generics operations.
This story is from the February 17, 2020 edition of The Hindu Business Line.
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This story is from the February 17, 2020 edition of The Hindu Business Line.
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