Query Board

Dalal Street Investment Journal - - CONTENTS -

I have bought Gennex labs @ 12. Now it is trad­ing low at 4.29. Is it ad­vis­able to exit or hold this stock? - Upad­hyaya Sreeni­vasa

Setup in 1995, Gennex Lab­o­ra­to­ries Lim­ited is a Phar­ma­ceu­ti­cal In­gre­di­ent man­u­fac­tur­ing com­pany with its unit lo­cated in IDA Bol­laram. Gennex is among the lead­ing ‘Ver­ti­cally In­te­grated’ phar­ma­ceu­ti­cal com­pa­nies in In­dia and has a prod­uct port­fo­lio spread over ma­jor prod­uct seg­ments en­com­pass­ing ex­pec­to­rants, mus­cle re­lax­ants, anal­gesic and anti-fun­gal. The com­pany has ap­proval from the State Drug Con­trol Au­thor­ity to man­u­fac­ture var­i­ous ac­tive phar­ma­ceu­ti­cals in­gre­di­ents. Gennex has a prom­i­nent global pres­ence with ex­ports spread across five con­ti­nents. On the fi­nan­cial front, Alem­bic Phar­ma­ceu­ti­cal’s rev­enue in­creased 8.8 per cent to ₹ 8.38 Crore in Q1FY18 from ₹ 7.70 crore in Q1FY17. More­over, the com­pany’s PBDT de­creased 27.5 per cent to ₹ 0.58 crore in the first quar­ter of FY18 vis-à-vis ₹ 0.80 Crore in Q1FY17. The com­pany’s net profit also de­creased by 41.66 per cent to ₹ 0.35 rore for the same pe­riod. On an an­nual ba­sis, the com­pany’s rev­enue in­creased 9.42 per cent to ₹ 41.91 crore in FY17 com­pared to the pre­vi­ous fis­cal. The com­pany’s PBDT also in­creased 1.8 per cent to ₹ 3.94 crore in FY17 on a yearly ba­sis. The com­pany’s net profit too in­creased from ₹ 3.87 crore in FY16 to ₹ 3.94 crore in FY17. Com­pany has a low re­turn on eq­uity of 7.04 per cent for last 3 years. Also the pro­moter’s stake has de­creased. We rec­om­mend our in­vestor’s to EXIT the stock.

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