Syngene has announced the establishment of a dedicated centre for Amgen, Inc. in Bangalore. This centre, called Syngene Amgen Research and Development Centre (SARC), will be Syngene’s fourth such exclusive R&D centre and the first for a biologics company. Syngene already operates dedicated R&D centres for Bristol-Myers Squibb (BMS), Abbott Nutrition (Abbott) and Baxter Inc. SARC will be staffed by a team of more than 100 Syngene scientists, working with Amgen researchers around the world on the discovery and development of innovative medicines.
Also, due to complexity of biologics and customer stickiness in biologic deals, we believe this deal will be more remunerative than the existing dedicated centres, going ahead.We expect sales, EBITDA and PAT to grow at a CAGR of 25.1%, 26.2% and 27.3% to| 2166 crore, | 720 crore and | 457 crore, respectively, over FY16-19E. We have introduced FY19 estimates. Accordingly, we arrive at our new target price of | 570 based on 25x FY19E EPS of | 22.8.