BNP Paribas maintains 'buy' Sun Pharma
BNP Paribas has maintained its ‘buy’ rating on Sun Pharma and also its price target of Rs 1,695 after the company initiated an out-of-court settlement with the promoters of Taro to acquire it.
By ET Bureau |
CMP: Rs 1,041.20
Target price: 1,695
BNP Paribas has maintained its ���buy��� rating on Sun Pharma and also its price target of Rs 1,695 after the company initiated an out-of-court settlement with the promoters of Taro to acquire it.
���We believe that an increase in consideration by 16-23% for the residual stake doesn���t alter the appeal of the Taro transaction for Sun Pharma,��� the bank said in a report. BNP expects Taro���s acquisition to be accretive to Sun���s earnings per share and have a ���15% positive impact��� on FY10 earnings. ���Taro���s operational history has been marred by accounting issues and cash flow problems. Despite these problems, we believe Taro represents a significant synergistic opportunity for Sun Pharma,��� it added.
Target price: 1,695
BNP Paribas has maintained its ���buy��� rating on Sun Pharma and also its price target of Rs 1,695 after the company initiated an out-of-court settlement with the promoters of Taro to acquire it.
���We believe that an increase in consideration by 16-23% for the residual stake doesn���t alter the appeal of the Taro transaction for Sun Pharma,��� the bank said in a report. BNP expects Taro���s acquisition to be accretive to Sun���s earnings per share and have a ���15% positive impact��� on FY10 earnings. ���Taro���s operational history has been marred by accounting issues and cash flow problems. Despite these problems, we believe Taro represents a significant synergistic opportunity for Sun Pharma,��� it added.
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