Divi’s Laboratories (NSE: DIVISLAB), a leading Indian pharmaceutical firm, has a major focus on the development, production, and marketing of active pharmaceutical ingredients (APIs) and intermediates. The business has a history of steady growth and profitability, and over the past ten years, it has been one of the best-performing stocks on the Indian market. With a market valuation of more than Rs. ₹ 92,489 Crore as of November 7, 2023, Divi’s Laboratories’ share price has been circling about Rs. 3,484 per share.
We will discuss the share price targets for Divi’s Laboratories during the subsequent 7–10 years, from 2023 to 2030 in this article. To determine whether Divi’s Labs is a solid investment, we will examine the company’s financial performance, growth potential, competitive environment, and industry trends.
Divi’s Laboratories Reports Q2 Results: Net Profit Declines 29%, Misses Estimates
- Divi’s Laboratories reported a 29.50% YoY decline in consolidated net profit, with Q2 profit at Rs 348 crore.
- This decline is attributed to a higher base in the previous year due to the contribution from the COVID-19 drug Molnupiravir.
- Q2 revenue increased by just 3% to reach Rs 1,909 crore, compared to Rs 1,855 crore in the same period last year.
- Analysts had expected higher net profit at Rs 423 crore and revenue at Rs 1,913.2 crore, based on estimates from eight brokerages.
- Operational performance weakened, with EBITDA at Rs 479 crore, down around 23% from the previous year, leading to a significant contraction in EBITDA margin.
- The company’s EPS dropped to 13.11 from 18.60 in the year-ago period.
- Despite the weak results, the company’s management expressed optimism about its custom synthesis projects and opportunities in complex amino acid products.
- Shares of Divi’s Labs reacted negatively to the earnings announcement, trading 1.3% lower at Rs 3,308.95 on the NSE.
- Over the past three months, the company’s stock has dropped by 11.5% due to consistently weak performance.
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When | Maximum Price | Minimum Price |
November 2023 | ₹3,762.72 | ₹3,271.93 |
December 2023 | ₹3,886.89 | ₹3,379.90 |
In November 2023, Divi’s Laboratories is expected to see its share price range between a maximum of ₹3,762.72 and a minimum of ₹3,271.93. The forecast for December 2023 suggests that the share price may rise further, with an estimated maximum of ₹3,886.89 and a minimum of ₹3,379.90. These projections indicate potential upward movement in the company’s stock.
As of now, the current share price stands at ₹3,484, and the company’s market capitalization is ₹92,489 crore. Investors and analysts will closely monitor these price targets to assess the performance and growth potential of Divi’s Laboratories in the coming months.
When | Maximum Price | Minimum Price |
January 2024 | ₹3,966.21 | ₹3,448.88 |
February 2024 | ₹4,047.16 | ₹3,519.27 |
March 2024 | ₹4,129.75 | ₹3,591.09 |
April 2024 | ₹4,009.47 | ₹3,486.49 |
May 2024 | ₹3,950.21 | ₹3,434.97 |
June 2024 | ₹4,092.42 | ₹3,558.63 |
July 2024 | ₹4,051.50 | ₹3,523.04 |
August 2024 | ₹4,213.56 | ₹3,663.96 |
September 2024 | ₹4,382.10 | ₹3,810.52 |
October 2024 | ₹4,296.18 | ₹3,735.81 |
November 2024 | ₹4,425.06 | ₹3,847.88 |
December 2024 | ₹4,535.69 | ₹3,944.08 |
In 2024, Divi’s Laboratories is poised for a potentially strong performance in the stock market, based on the projected share price targets. In January, the share price is estimated to reach a maximum of ₹3,966.21 and a minimum of ₹3,448.88, with consistent growth expected throughout the year.
By December 2024, the share price is anticipated to reach a maximum of ₹4,535.69 and a minimum of ₹3,944.08. These forecasts suggest a positive outlook for Divi’s Laboratories, with potential for significant value appreciation. Investors and stakeholders will closely monitor the company’s performance in line with these projections, which could indicate a promising year ahead.
When | Maximum Price | Minimum Price |
January 2025 | ₹4,626.40 | ₹3,558.77 |
February 2025 | ₹4,745.03 | ₹3,650.02 |
March 2025 | ₹4,930.08 | ₹3,792.37 |
April 2025 | ₹4,833.42 | ₹3,718.01 |
May 2025 | ₹4,692.64 | ₹3,609.72 |
June 2025 | ₹4,903.81 | ₹3,772.16 |
July 2025 | ₹4,807.65 | ₹3,698.19 |
August 2025 | ₹4,956.34 | ₹3,812.57 |
September 2025 | ₹5,129.82 | ₹3,946.01 |
October 2025 | ₹5,263.19 | ₹4,048.61 |
November 2025 | ₹5,394.77 | ₹4,149.82 |
December 2025 | ₹5,529.64 | ₹4,253.57 |
In 2025, Divi’s Laboratories appears to be on a trajectory of strong growth and potential value appreciation, as indicated by the projected share price targets. In January 2025, the estimated share price range is between a maximum of ₹4,626.40 and a minimum of ₹3,558.77, showcasing a significant upward trend. This positive momentum continues throughout the year, with December 2025 projections reaching a maximum of ₹5,529.64 and a minimum of ₹4,253.57. These forecasts suggest a bullish sentiment surrounding the company, with the share price expected to exhibit consistent growth over the course of the year.
Investors and market observers will be keenly monitoring Divi’s Laboratories as it progresses through 2025.
Year | Maximum Price | Minimum Price |
2026 | ₹5,806.12 | ₹4,064.28 |
2027 | ₹6,386.73 | ₹4,470.71 |
2028 | ₹8,941.43 | ₹4,470.71 |
2029 | ₹7,741.50 | ₹3,870.75 |
2030 | ₹10,063.94 | ₹7,044.76 |
The share price targets for Divi’s Laboratories for the period spanning 2026 to 2030 suggest a continued and potentially substantial upward trajectory. In 2026, the estimated share price is projected to reach a maximum of ₹5,806.12 and a minimum of ₹4,064.28, reflecting a positive outlook for the company’s growth potential. As we move into 2027, the price targets become even more optimistic, with a maximum of ₹6,386.73 and a minimum of ₹4,470.71.
The year 2028 stands out with a significant projected range, indicating a remarkable surge in value. The share price is forecasted to reach a maximum of ₹8,941.43, with a minimum of ₹4,470.71. The subsequent years, 2029 and 2030, maintain strong growth expectations, with substantial ranges. In 2029, the share price is estimated to fluctuate between a maximum of ₹7,741.50 and a minimum of ₹3,870.75, while in 2030, it is expected to reach an impressive maximum of ₹10,063.94, with a minimum of ₹7,044.76.
These projections illustrate an exciting growth trajectory for Divi’s Laboratories, suggesting robust market demand, successful product performance, and favorable industry conditions.
Financial Condition of Divi’s Laboratories: Last 5 years
Metric | Mar 2019 | Mar 2020 | Mar 2021 | Mar 2022 | Mar 2023 |
---|---|---|---|---|---|
Sales + (in Crore Rs) |
4,946 | 5,394 | 6,969 | 8,960 | 7,768 |
Expenses + (in Crore Rs) |
3,072 | 3,568 | 4,102 | 5,075 | 5,400 |
Operating Profit (in Crore Rs) |
1,874 | 1,826 | 2,867 | 3,885 | 2,368 |
OPM % | 38% | 34% | 41% | 43% | 30% |
Other Income + (in Crore Rs) |
154 | 186 | 57 | 112 | 345 |
Interest (in Crore Rs) |
5 | 7 | 2 | 2 | 1 |
Depreciation (in Crore Rs) |
169 | 186 | 256 | 312 | 343 |
Profit before tax | 1,855 | 1,819 | 2,666 | 3,684 | 2,369 |
Tax % | 27% | 24% | 26% | 20% | 23% |
Net Profit + (in Crore Rs) |
1,353 | 1,377 | 1,984 | 2,960 | 1,823 |
EPS in Rs | 50.96 | 51.85 | 74.75 | 111.52 | 68.69 |
Over the past five years, Divi’s Laboratories has experienced consistent growth, as evidenced by its financial statements. The company’s revenue has increased steadily from ₹3,891.49 crores in March 2018 to ₹7,768 crores in March 2023, indicating an impressive revenue growth of approximately 100%.
During the same period, Divi’s Laboratories’ net profit has also shown an upward trend, with a maximum net profit of ₹2,960.45 crores in March 2022, a significant increase from the minimum net profit of ₹877.01 crores in March 2018. Divislab’s net profit in 2023 however has declined to ₹1,823 Crore, slightly below what the company reported in FY ending 2021.
Excluding 2023, upto 2022, the percentage growth in net profit has been equally remarkable, with a growth of over 100% in the four years.
Also, Divi’s Laboratories’ operating profit margin (OPM) has also been consistently high, indicating the company’s efficient operations. The OPM has steadily increased from 32.61% in March 2018 to 43.36% in March 2022 and 30% in March 2023, indicating high profit margin.
Divi’s Laboratories has also maintained an impressive dividend payout ratio, with a range of 26.76% to 31.40% over the past five years. The company’s earnings per share (EPS) has also shown a steady increase, from ₹33.03 in March 2018 to ₹111.50 in March 2022.
In conclusion, Divi’s Laboratories has shown consistent growth in revenue, profit, and operational efficiency over the past five years.
Religare Broking recommends purchasing Divi’s Laboratories with a target price of Rs 4,130. (August 8, 2023)
Prabhudas Lilladher advises maintaining a hold on Divi’s Laboratories with a target price of Rs 3,000. ( August 15, 2023)
FAQS
It is anticipated that Divi’s Laboratories per share price will increase to ₹3,886.89 by the end of 2023.
The share price target of Divi’s Laboratories for 2025 might be around ₹5,529.64.
Is Divi’s Laboratories free from all debts?
Yes, Divi’s Laboratories is a stock that has no debt and has the potential to grow significantly, resulting in investors becoming millionaires over an extended period.
The per share price of Divi’s Laboratories might reach around ₹10,063.94 by the end of 2030.
Can we consider Divi’s Laboratories as a large-cap stock?
Yes, Divi’s Laboratories Ltd, established in 1990, is a company operating in the pharmaceutical sector with a market capitalization of Rs ₹ 92,489 Crore, making it a Large Cap company.
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Conclusion: Should You Invest in Divi’s laboratories?
Well, one thing so good about Divis Laboratories is its profit margin, which has been above 30% quarter on quarter for quite some time now. Divi’s Laboratories is also one of the favorite stocks of Saurabh Mukherjee. Let’s look at the PE ratio of the company to decide whether DIVISLABS is overvalued or undervalued.
Looking at the Divislabs PE ratio, we can say, around January, February was a good time to accumulate Divis Labs when the PE ratio was around 30, and in comparison, PE ratio is around 55. The median PE is 46.4. We are definitely trading above the median PE, and hence the stock is overvalued.
I would wait for the stock to correct by 20-25% before taking a position in Divislab. Sales and Profit has reduced for the last 4 quarters.
Company’s sales have dropped. Divis Laboratories’ share price is under pressure due to a combination of factors. Gross margins are suffering from the one-time opportunities linked to Covid drugs, pricing pressures on APIs, and increased raw material costs, which have impacted both the top and bottom lines over the past year. However, the company expects improvements in gross margin and profitability growth in the future, as raw material procurement and availability have stabilized.
With an anticipated growth rate of 15% annually, the company’s share price objective for the years 2023 to 2030 appears to be on the right track. Divi’s shares may appear pricey with a market valuation of 99967 crore and a price-to-earnings ratio of 55, but they have high long-term growth potential. Thus, Divi’s Laboratories may be a suitable option for investors seeking a solid stock in the pharmaceutical industry.
What did we learn?
- 1 Divi’s Laboratories Reports Q2 Results: Net Profit Declines 29%, Misses Estimates
- 2 How to buy Divi’s Laboratories shares?
- 3 Share Price Prediction of Divi’s Laboratories: 2023 to 2030
- 4 Financial Condition of Divi’s Laboratories: Last 5 years
- 5 Divi’s Laboratories share price target by Experts
- 6 FAQS
- 6.1 Will the share price of Divi’s Laboratories increase in 2023?
- 6.2 What is the share price target of Divi’s Laboratories for 2025?
- 6.3 Is Divi’s Laboratories free from all debts?
- 6.4 What is the share price target of Divi’s Laboratories for 2030?
- 6.5 Can we consider Divi’s Laboratories as a large-cap stock?
- 7 Conclusion: Should You Invest in Divi’s laboratories?