Time period given by analyst is one year when Cipla price can reach defined target.
Cipla Ltd., incorporated in the year 1935, is a Large Cap company (having a market cap of Rs 76255.66 Crore) operating in Pharmaceuticals sector.
Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 4666.58 Crore, down -11.21 % from last quarter Total Income of Rs 5255.63 Crore and up 4.41 % from last year same quarter Total Income of Rs 4469.37 Crore. Company reported net profit after tax of Rs 415.51 Crore in latest quarter.
Investment Rationale
The brokerage believes Cipla has the best US generics pipeline, along with a strong branded business in India and South Africa. Successful execution in these businesses will continue to drive rerating. It expects medium-term (FY21-24E) revenue, EBITDA and PAT CAGRs (ex-Revlimid) of 9%, 15% and 19%, respectively. Despite these factors, the stock is trading at a 1- year forward P/E of 24x vs. its historical average of 27x. The brokerage values the stock at 25x P/E on Sep’23E core earnings at Rs1,120 and add gRevlimid NPV of Rs20 to arrive at a TP of Rs1,140. Catalyst: limited competition product launch, continued uptick form the Covid-19 portfolio and Goa plant resolution. Downside risks: adverse regulatory outcome and delay in the launch of key products.
Promoter/FII Holdings
Promoters held 36.7 per cent stake in the company as of June 30, 2021, while FIIs held 24.8 per cent, DIIs 16.2 per cent and public and others 22.3 per cent.
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