Cadila Healthcare bucked the market trend and rose 6% in yesterday's trade with 2x volumes on an average of 2 weeks.
The surge was largely driven by strong 4Q results and increasing probability of approvals from USFDA to meet its Rs100bn revenue target in FY16E.
We believe the growth story in US will unfold over the next 3 years attaining sales of US$800mn with Cadila awaiting 161 approvals (260 filed, 99 approved).
In the past, Cadila had expanded rapidly across geographies and technology platforms with significant investments in transferals, nasals and vaccines, which will start yielding results from FY16E onwards followed by biologics and respiratory. In our view, the monetization of the US filing efforts can deliver significant upside to the current earnings expectations.
We maintain BUY with a Target Price of Rs.2,025
No comments:
Post a Comment