Alembic: Prospects sound\, but investors should await a better entry point

Alembic: Prospects sound, but investors should await a better entry point

Higher capex and depreciation post commercialisation, increased operating costs as well as interest costs are expected to hit the company's FY22 earnings

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Alembic Pharma | Investors

Ram Prasad Sahu  |  New Delhi 

After hitting its 52-week high last week, the stock of Alembic Pharmaceuticals shed about 8 per cent. The company is raising Rs 1,200 crore through a qualified institutional placement to reduce debt and fund its expansion plans.

The equity infusion is expected to lead to a dilution of 6.4 per cent. Higher capex (Rs 2,000 crore) and depreciation post commercialisation, increased operating costs as well as interest costs are expected to hit the company’s FY22 earnings. While there will be some equity dilution, some of this could get offset by lower interest cost as the company is ...
First Published: Mon, July 27 2020. 19:00 IST