Dr Reddy's Lab can Touch 1,950: HSBC

HSBC has reiterated its 'Overweight' rating on Dr Reddy's Lab and set a target price of 1,950.

The timely Geodon launch adds comfort to the US growth story for Dr Reddy's. HSBC expects fondaparinux to ramp up slowly and add to base sales materially in the US over FY13-15.

It values the stock at 20x Sep-13 EPS of 96 and adds 20 for para-IV value.

However, the early FDA warning to Pfizer on paediatric trials covering Geodon could have impacted paediatric patent extension.

The base patent of Geodon had earlier got one five-year term extension to March 2012 from March 2007.