The earnings season is on us and it is expected to be a muted quarter for pharmaceutical companies.

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According to Amey Chalke, Research Analyst at HDFC Securities, Cadila will perform well on back of product launches in Q2 of FY18. The year-on-year performance would be strong for the company but could report sequential decline in topline and margin.

Divis Laboratory has contract research and manufacturing (CRAM) business model and fourth quarter is seasonally good for them. The topline would be around Rs 1,100 crore and margins improvement to around 34.5 percent.

Currently, neutral on the stock because its valuations are expensive. Similarly, Dishman Pharma is also a buy because of is CRAMs business model.

Expect Torrent Pharma to report good profitability going ahead after acquisition of Unichem and if they continue to report 24 percent-plus EBITDA margins, then one could see re-rating for the stock.

Good time to start buying Alkem Laboratories at current prices, said Chalke.

First Published:Apr 18, 2018 1:08 PM IST