Buy Cipla, target price Rs 842: ICICI Securities

ICICI Securities has given a buy rating to Cipla with a target price of Rs 842. The share price moved up by 0.44 per cent from its previous close of Rs 779.10. The stock’s last traded price is Rs 782.55.

Cipla Ltd., incorporated in the year 1935, is a Large Cap company (having a market cap of Rs 62780.29 Crore) operating in Pharmaceuticals sector.

Cipla Ltd. key Products/Revenue Segments include Pharmaceuticals which contributed Rs 12220.22 Crore to Sales Value (96.53 % of Total Sales), Export Incentives which contributed Rs 249.96 Crore to Sales Value (1.97 % of Total Sales), Other Operating Revenue which contributed Rs 103.40 Crore to Sales Value (0.81 % of Total Sales), Royalty Income which contributed Rs 56.02 Crore to Sales Value (0.44 % of Total Sales) and Scrap which contributed Rs 29.55 Crore to Sales Value (0.23 % of Total Sales)for the year ending 31-Mar-2020.


Financials
For the quarter ended 30-06-2020, the company reported a Consolidated sales of Rs 4276.89 Crore, down -.57 % from last quarter Sales of Rs 4301.60 Crore and up 9.82 % from last year same quarter Sales of Rs 3894.46 Crore. The Company reported net profit after tax of Rs 571.43 Crore in latest quarter.

Investment Rationale
Faster retracement on the long-term chart as 20 quarter down leg ((752- 355) was completely retraced in just 2 quarter and MACD in buy mode

Promoter/FII Holdings
Promoters held 36.68 per cent stake in the company as of March 31, 2020, while FIIs held 20.31 per cent, DIIs 20.86 per cent and public and others 22.16 per cent.