Analysts' picks : Glenmark Pharma
Citi has maintained a ‘buy’ rating on Glenmark Pharmaceuticals after the company maintained its revenue and PAT guidance for FY09-10.
Glenmark Pharma
cmp: Rs 315.75
target price: Rs 770
Citi has maintained a ���buy��� rating on Glenmark Pharmaceuticals after the company maintained its revenue and PAT guidance for FY09-10. The report also notes that while there has been some concern on the street related to guidance, given the disappointing second quarter results, the management stated that the second half would be materially better.
���We believe third quarter results will be crucial for the stock as there is not much room for execution slip-ups, post the weak first half,��� says the report. Citi���s positive outlook on the stock is also based on factors such as the R&D pipeline, wherein the company is expecting seven molecules to be in the clinic by end FY08 and also due to the fact that the base business has achieved significant traction, especially in the US and Latin America.
Citi also believes that the rapid scale-up in the base business adds another catalyst for the stock, apart from the option value being built in by its R&D effort. ���Although there are potential risk triggers that could lead to partial erosion of the option value, we believe the risk-reward remains in favour of investors,��� says the report.
cmp: Rs 315.75
target price: Rs 770
Citi has maintained a ���buy��� rating on Glenmark Pharmaceuticals after the company maintained its revenue and PAT guidance for FY09-10. The report also notes that while there has been some concern on the street related to guidance, given the disappointing second quarter results, the management stated that the second half would be materially better.
���We believe third quarter results will be crucial for the stock as there is not much room for execution slip-ups, post the weak first half,��� says the report. Citi���s positive outlook on the stock is also based on factors such as the R&D pipeline, wherein the company is expecting seven molecules to be in the clinic by end FY08 and also due to the fact that the base business has achieved significant traction, especially in the US and Latin America.
Citi also believes that the rapid scale-up in the base business adds another catalyst for the stock, apart from the option value being built in by its R&D effort. ���Although there are potential risk triggers that could lead to partial erosion of the option value, we believe the risk-reward remains in favour of investors,��� says the report.
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