Buy Jubilant Pharmova, target price Rs 960: Motilal Oswal

Motilal Oswal has buy call on Jubilant Pharmova Ltd. with a target price of Rs 960. The current market price of Jubilant Pharmova Ltd. is Rs 738.7. Time period given by analyst is one year when Jubilant Pharmova Ltd. price can reach defined target.

Jubilant Pharmova Ltd., incorporated in the year 1978, is a Mid Cap company (having a market cap of Rs 11743.00 Crore) operating in Pharmaceuticals sector.

Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 1586.47 Crore, down -10.62 % from last quarter Total Income of Rs 1774.93 Crore and down -34.19 % from last year same quarter Total Income of Rs 2410.85 Crore. Company reported net profit after tax of Rs 199.30 Crore in latest quarter.


Investment Rationale
The brokerage remains positive on JP on the back of (a) a strong order book for the CDMO segment, (b) new customer additions in the API segment, (c) better growth prospects for Ruby-Fill, and (d) a long-term pipeline for radiopharmaceutical products. The brokerage expects a 9% earnings CAGR over FY21–23. FY21 had 10 Months of business from demerged LSI business segment. It values JP at a 12M forward EV/EBITDA multiple of 9x to arrive at Target Price of INR960 per share.

Promoter/FII Holdings
Promoters held 50.7 per cent stake in the company as of March 31, 2021, while FIIs held 25.8 per cent, DIIs 1.3 and public and others 22.3 per cent.