Pharmaceuticals & Biotech. share price target

We expect the companies under our pharmaceutical coverage to clock 31% (YoY) earnings growth with a 5.5% (YoY) rise in the revenue base due to moderate growth in the domestic market supported by a partial recovery in the acute segment, reasonable traction in the chronic segment. The US revenues are likely to remain subdued impacted by the lack of meaningful launches while overall prescriptions remained low due to a surge in COVID cases during the quarter. We expect continued traction in API sales backed by strong demand. Overall, our pharmaceutical coverage would post Revenue/EBIDTA/PAT growth of 5.5%/33.6%/31.1% YoY in Q4FY21. We expect the EBITDA margin of our coverage universe to improve by 478bps YoY, led by base effect (select pack), cost...

We are reiterating our positive view on the Pharma sector.

Diagnostic companies would benefit from rising COVID cases throughout the country leading to higher RT-PCR testing in 4QFY21. Even with reduction in COVID testing prices for multiple times in last few months, it will likely...

IPM is struggling for growth above 10% even after MoM abating COVID concerns and with MRs, physician activities almost reaching pre-COVID level. We believe key reasons for growth below par are (i) subdued new prescription (Rx) leading to volume de-growth (ii) digital marketing yield going south and (iii) sustained lower demand of acute products. Cardiac and anti-diabetic growth takes a breather in Jan-21 at 8.8% and 5.3% after reporting double digit growth in most months during lockdown. While amongst top therapies Gastro and VMN reported double digit growth of 14%...

We expect the companies under our pharmaceutical coverage to clock 36.7% (YoY) earnings growth with an 8.4% (YoY) rise in the revenue base, led by a notable recovery in the domestic market and healthy growth in the export market. In the domestic business, the chronic portfolio continues to be steady, and acute therapies are recovering slowly. US formulations are expected to grow due to a ramp-up in speciality products supported by improving prescription trends, new product launches, and favourable currency movement. We expect a moderation in API sales, which were abnormally high during H1FY21 due to the stocking of raw material by formulation companies. The recent INR weakness will also benefit Indian pharma companies, but some of the margin benefits are being offset from EM currencies and higher API/ KSM costs. Overall, our pharmaceutical coverage would...

The US (select pack) portfolio is expected to grow ~7% YoY to | 12808 crore due to 1) YoY strengthening of US$ vs. rupee (3.6%), 2) new launches (Dr Reddy's) and 3) increased traction/recovery in specialty, injectable portfolios (Albuterol Cipla, Lupin, Insulin Biocon, Injectables - Aurobindo). Domestic formulations (select pack) are expected to grow ~10% to | 9908 crore. Europe is expected to grow ~15% YoY driven by new launches, ramp-up in existing products and currency benefits. API segment is also expected to post strong ~16% YoY growth on the back of a low base effect and shortterm opportunities amid Covid. On the hospitals front, continued QoQ...

to report double-digit growth on back of COVID led products, 2) US QoQ growth to be company specific with selective products driving growth while specialty products sales to be better and also reached pre-COVID levels, 3)...

Cipla: Owing to competition, we expect Cipla to garner 1-7% market share for volume-limited period and 15% thereafter. Hence, with above market share and a 70-90% price erosion assumption, our gRevlimid NPV arrives at | 41. We maintain BUY rating and arrive at a target price of | 965, including...

We hosted Ajanta pharma, Eris Life, Jubilant Life, Indoco Remedies and Suven pharmaceuticals on December 3rd-4th, 2020 on digital platform. Key 2) Companies increased their inventory days for API post COVID due to unstable environment 3)Travel restriction stay in place for USFDA inspectors, which could delay resolution of plants and new approvals while virtual audit still not a reality, 4) New ANDA filing rate to be lower in FY21E due to COVID, 5) Institutional tender orders for anti-malaria products to remain asymmetric in FY21/22E due to diversion of funds from donors, 6) Refrained from addition...

IPM grew by 4% YoY in Aug-Oct after second consecutive growth month. Oct-20 data points indicate that IPM growth could be back at pre-COVID level as 1) IPM witnessed second consecutive month of strong growth, for the first...