Divi’s Laboratories Gets ₹570.51 Crore Draft Tax Notice, Stock May React On Monday Amid Tax & Earnings Updates

Mumbai: Divi's Laboratories Ltd has received a draft assessment order from the Income Tax Department proposing additions and disallowances worth ₹570.51 crore. The order relates to the financial year 2022–23 and was issued under Section 144C(1) of the Income Tax Act 1961 on March 20, 2026, and received by the company on March 21. It was issued by the Assistant Commissioner of Income Tax, Central Circle-2(1), Hyderabad.

Penalty Proceedings to Follow

The proposed additions are linked to transfer pricing and corporate tax adjustments, which could result in additional tax liability for the company. The draft order also mentions that separate penalty proceedings under Section 270A for under-reporting of income will be initiated.

The company has stated that it is currently reviewing the order and will file an appeal before the appropriate authority within the prescribed time.

Quarterly Performance: Mixed Trends

For the December quarter, Divi’s Laboratories reported a net profit of ₹583 crore, slightly lower by 1 percent compared to ₹589 crore in the same period last year. The profit also missed market expectations of ₹640 crore.

However, revenue rose 12.3 percent year-on-year to ₹2,604 crore, compared to ₹2,319 crore last year, though it fell short of estimates of ₹2,680 crore.

At the operating level, EBITDA increased 19.8% to ₹890 crore from ₹743 crore last year. EBITDA margin improved to 34.2% from 32%, indicating better operational efficiency despite softer revenue growth.

On a quarter-on-quarter basis, revenue declined by 4.1%, while profit dropped 15.4%.

Stock Performance and Market Outlook

The company’s stock closed 2.15% higher at ₹6,101 on Friday. Over the past five days, the stock gained 0.44%. However, it has declined 3.06% in one month.

In the longer term, the stock has shown modest gains, rising 0.14% over six months and 5.24% over the past one year.

Market participants are likely to closely watch the stock’s movement when trading resumes on Monday, especially in light of the tax notice and recent earnings performance.

Disclaimer: This report is for informational purposes only and not investment advice. Investors should consult certified financial advisors before making decisions. Market investments are subject to risks, including possible loss of capital.