Buy Sanofi India, target price Rs 9250: Sharekhan by BNP Paribas
Sanofi reported strong results for Q1CY22 with operating margins expanding 139 bps y-o-y and were better than estimated, leading to a PAT ahead of estimates.
By ETMarkets.com | Updated:
Agencies
Sharekhan by BNP Paribas has buy call on Sanofi India with a target price of Rs 9250. The current market price of Sanofi India is Rs 6977.9.
Sanofi India, incorporated in the year 1956, is a Mid Cap company (having a market cap of Rs 16063.74 Crore) operating in Pharmaceuticals sector.
Sanofi India key Products/Revenue Segments include Pharmaceutical Products, Sale of services, Other Operating Revenue, Export Incentives and Scrap for the year ending 31-Dec-2021.
Financials
For the quarter ended 31-03-2022, the company has reported a Standalone Total Income of Rs 731.40 crore, up 3.86 % from last quarter. Total Income is Rs 704.20 crore and down -2.66 % from last year same quarter. The company has reported net profit after tax of Rs 238.40 Crore in latest quarter.
Investment Rationale
Sanofi reported strong results for Q1CY22 with operating margins expanding 139 bps y-o-y and were better than estimated, leading to a PAT ahead of estimates. Sanofi’s plan to emphasize on three areas - accelerating growth in the diabetology space, fortifying presence in established/top brands, focusingon building brands in consumer products, could drive the growth ahead, the brokerage said. Also, expected strong growth in insulin products and portfolio expansion in cardiology could add to the growth. Emphasis on leveraging the digital platform and divestment of the slow-moving business is expected to drive OPM expansion, leading to a double-digit 10% PAT CAGR over the next two years.
Promoter/FII Holdings
Promoters held 60.4 per cent stake in the company as of 31-Mar-2022, while FIIs owned 8.99 per cent, DIIs 18.64 per cent.
Sanofi India, incorporated in the year 1956, is a Mid Cap company (having a market cap of Rs 16063.74 Crore) operating in Pharmaceuticals sector.
Sanofi India key Products/Revenue Segments include Pharmaceutical Products, Sale of services, Other Operating Revenue, Export Incentives and Scrap for the year ending 31-Dec-2021.
Financials
For the quarter ended 31-03-2022, the company has reported a Standalone Total Income of Rs 731.40 crore, up 3.86 % from last quarter. Total Income is Rs 704.20 crore and down -2.66 % from last year same quarter. The company has reported net profit after tax of Rs 238.40 Crore in latest quarter.
Investment Rationale
Sanofi reported strong results for Q1CY22 with operating margins expanding 139 bps y-o-y and were better than estimated, leading to a PAT ahead of estimates. Sanofi’s plan to emphasize on three areas - accelerating growth in the diabetology space, fortifying presence in established/top brands, focusingon building brands in consumer products, could drive the growth ahead, the brokerage said. Also, expected strong growth in insulin products and portfolio expansion in cardiology could add to the growth. Emphasis on leveraging the digital platform and divestment of the slow-moving business is expected to drive OPM expansion, leading to a double-digit 10% PAT CAGR over the next two years.
ADVERTISEMENT
At the CMP, the stock trades at 26.8x/23.6x, respectively, its CY22E/CY23E estimates. High-growth visibility from chronics, strong and debt-free balance sheet, sturdy dividends, and healthy cash position are the key positives for Sanofi, hence we retain our Buy recommendation on the stock with an unchanged PT of Rs 9,250.Promoter/FII Holdings
Promoters held 60.4 per cent stake in the company as of 31-Mar-2022, while FIIs owned 8.99 per cent, DIIs 18.64 per cent.
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