gautham,
The instance of torrent was when torrent pharma delivered much better than expected earnings on the back of abilify opportunity. There was a very muted reaction to such a wonderful result. I think similar thing happened in Alembic pharma also and many a times on approvals of many drugs by USFDA approvals. That should have told us markets knew more than what we thought.
In case of PI there has never been great results in past quarter. I consider topline extremely important in these kind of companies and topline increased from 584 to 605 crores in March 16 vs March 17 quarter. Op profit and net profit did increase but for me as I mentioned earlier topline remains very important unless I have definite reason to believe that the muted topline is a one off. Even in earlier Dec quarter comparision u can see that topline growth was muted.
So a correction because of lacklustre results is something which is expected and there’s nothing new in it for me. This kind of lacklustre topline growth can continue for a couple of quarters more but at a certain price all these concerns would be considered to be priced in. What is that price is a very subjective decision. But as I mentioned in my previous post if the future looks good for next 3-5 years, I would be okay holding.