Sunday, August 19, 2012
Pharma/Agrochemicals Exporters Q1 FY13
We have been writing about our bullishness on Pharma/Agrochemicals exporting sector over next 4 years. We wrote Depreciation of Rupee, Cheap labor, India’s natural strength in knowledge-oriented sectors, Generics encouragement by world governments and intense pressure on innovator pharma/crop science companies to reduce cost are macro reasons for bullishness in this sector.
However, remember that we are strictly a stock picker and want supporting data to prove our macro case. This means impact of macro should also be seen on the topline and bottomline of companies operating in that sector otherwise any macro view is useless :-). So, we picked 10 companies from this Pharma/Agrochemicals exporting sector and checked growth they showed in Sales, EBIDTA and EPS for Q1 FY13 over Q1 Fy12.
If we check above table (arranged in order of sales growth) we note that positive macro is indeed getting reflected in results and sector may be getting ready for good growth in next few years.
Disc: We have vested interest in stocks/sectors mentioned above and have recommended to clients. Personal holding in Hikal and DIL.