Post the Q4FY23 earnings announced by Divi’s Labs over the weekend, one had expected the stock to tank big time but with value buyers coming in, the stock is actually in the green. Though the stock opened around 0.25% lower at Rs.3090 and slipped further to Rs.3050, it bounced back sharply from these levels to Rs.3197.35, up over 3% and continues to trade around the same levels.
The company for the quarter, posted a 64% (YoY) slump in net profit at Rs.321 crore, though it was up 5% QoQ.
Its topline fell 23% (YoY) to Rs.1951 crore. Operating profit slumped 56% to Rs.488 crore while margins slipped sharply from 43.9% to 25%.
Though all the numbers were way below what most analysts had estimated, the sequential growth is what has propelled value buying on the counter. The higher base on account of the pandemic shows the YoY numbers to be low but looking ahead, most brokerage houses expect an improvement based on lower raw material prices, better operating leverage and scale-up in commercial contracts in the Chloroquine-Sensitive segment.