Cipla posted numbers lower than expected for 2QFY2017. The company posted
sales of Rs3,672cr vs. Rs3,737cr expected, registering a yoy growth of 8.7%,
mainly aided by domestic formulations. Domestic formulation (Rs1,522cr) grew by
11.3% yoy, while exports (Rs2150cr) grew by 7.5% yoy. On the operating front,
the EBITDA margin came in at 16.4% vs. 16.5% expected vs. 21.0% in
2QFY2016, mainly on back of base effect. Consequently, the Adj. PAT came in
at Rs354cr vs. Rs498cr expected vs. Rs543cr in 2QFY2016, a yoy de-growth of
34.7%. We maintain our Reduce rating on the stock.

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