I am bumping this old thread to get the perspective of of our senior members on the latest developments and valuations. Today, the stock crashed 20% on recent FDA observations on its Vizag plant.
Divi’s Laboratories Limited started off during 1990 as an R&D and consultancy company for development of commercial processes for Active Pharmaceutical Ingredients (“API”) and intermediates. During 1994, the Company forayed into manufacturing operations for API and intermediates by settingup a multi-purpose manufacturing facility near Hyderabad with a modest initial investment of Rs.71 crores. Divi operates from its Head quarters and Registered Office at Hyderabad. The company now has four multi-purpose manufacturing facilities with all support infrastructure like Utilities, environment management and safety systems.
First facility is located at village Lingojigudem, Nalgonda District near Hyderabad (Telangana) comprising 13 multipurpose production blocks with clearly defined finished product areas for APIs with clean air and purified water systems that operate under full cGMP as per US-FDA guidelines. Spread on 500 acres equipped with around 362 reactors totaling a capacity of 1744 m3 supported with all utility and service units.
Export Oriented Unit (Unit II):
Second Facility is located at village Chippada,Bheemunipatnam Mandal, about 30 KM from the port cityof Visakhapatnam (Andhra Pradesh) on the east coast
situated on a 100-acre site which went into commercial operations since March, 2003. The Unit has 8 production
blocks with around 192 reactors totaling a capacity of 1622.55 m3 with all utility and service units.
Third facility is located at village Chippda situated on a sprawling 267-acre site which went into commercial operations since November, 2006.Unit has 9 production blocks with around 420 reactors totaling a capacity of 3053.4 m3 with all required utility and infrastructure.
DSN SEZ Unit:
Fourth unit is located at the company's pharma SEZ at chippada village. The Unit has 5 production blocks with around 254 reactors totaling a capacity of 2389.46 m3 with all required utility and infrastructure.
According to the following report this plant is its largest facility and accounts for 70% of revenue. US contributes 32% of company's overall revenue. not sure about it's authenticity though.
Company is one of most consistent performer financially. I pulled the following details from screener.
promoter's hold 52% of equity. Company completed 25 years of operations recently.
Some uncertainties to watch out for :
Recent FDA 483 observations on its largest export plant.
Company's recent expansion plans in AP landed in some trouble with locals and political issues.
I invite senior's views on the company's as long term investment option at present valuations.
Currently, it is trading at at 52 week low and at a trailing PE of ~21 post this crash.
disclosure: Invested, 3% of portfolio, planning to add more