Hold Glenmark Pharma, target Rs 595: Emkay Global

Emkay Global Financial Services has a hold call on Glenmark Pharmaceuticals Ltd. with a target price of Rs 595. The current market price of Glenmark Pharmaceuticals Ltd. is Rs 524.8 Time period given by the brokerage is a year when Glenmark Pharmaceuticals Ltd. price can reach defined target.

Glenmark Pharmaceuticals Ltd., incorporated in 1977, is a largecap company with a market cap of Rs 14943.63 crore.

Investment rationale by Emkay Global


 Q4 numbers for GNP broadly in line with expectations though pricing environment in the US still remains uncertain. Overall GNP’s revenue guidance (10-15% revenue growth) does not inspire too much confidence in underlying growth rates sustaining

 Focus on speciality pipeline but still early days in commercialization of the branded business in US

 Material balance sheet deleveraging still some time away, near term cash flows weighed by investments in capex and developing a speciality pipeline

 Maintain HOLD rating as we cut earnings across FY19/20. Value GNP at PE of 18x on FY20 earnings which is in line with peers