Karvy Stock Broking Limited has maintained ‘Buy’ rating on Divis Laboratories stock with an intraday target of Rs 1650.

According to Karvy, day traders can purchase the stock above Rs 1600 with a strict stop loss of Rs 1580. If the stock market remains on positive track, the next target for the day will be above Rs 1552.

Shares of the company, on Tuesday (June 17), closed at Rs 1597.30 on the Bombay Stock Exchange (BSE). The total volume of shares traded at the BSE was 83648. Current EPS and P/E stood at 54.77 and 29.52 respectively. The share price has seen a 52-week high of Rs 1930 and a low of Rs 990.25 on BSE.

The outlook for the stock is really very strong, and it is expected to rise on the back of huge volumes.

For the year ended March 2008, Divis Laboratories announced a phenomenal rise in standalone net profit. During the year, the profit of the company surged 84.40% to Rs 3,535.60 million from Rs 1,917.40 million in the previous year. The company posted earnings of Rs 54.77 a share during the year, registering 63.37% decline over prior year. Net sales for the year surged 42.62% to Rs 10,331.90 million, while total income during the year jumped 41.84% to Rs 10,468.00 million, when compared with the prior year period.

During the year, the company announced a rise in operating margin of 639.49 basis points to 40.35% on lower input cost. Interest cost decreased 3.69% to Rs 101.80 million while depreciation cost rose 59.65% to Rs 356.50 million over previous year period.

The board of directors, at its meeting held on June 07, 2008, has recommended a dividend of 200% on equity shares for the year ended March 31, 2008.

Other stocks from the pharmaceutical sector that looks good for short-term trading includes Sun Pharma, Ranbaxy Labs, Glenmark, Cipla and Dr Reddys Labs.