Subscribe to Claris Lifesciences IPO: KR Choksey

MUMBAI: KR Choksey has recommended investors to ‘Subscribe’ to the initial public offering of Claris Lifesciences.

The company has entered the primary markets by offering shares in the price band of Rs 278-293 per share. The issue closes Friday.

“We recommend SUBSCRIBE on the back of Claris Lifesciences’ low cost competitive advantage, having presence in niche segment (sterile injectable), and healthy growth prospects. The company looks attractive on valuations front (available at 44% discount to average sectoral PER of 22x) compared to it peers such as Strides Arcolab, Aurobindo and Torrent Pharma.

There are few concerns such as 1) USFDA issues, 2) CLL’s erstwhile promoters and relatives (included in promoter group) are classified as willful defaulters by CIBIL etc.

However we believe that the USFDA issue will have a minimal impact on its business as its revenue contribution from US business is low. All the concerns have been priced in and we are confident on the long term growth propects of the company driven by its sterile injectable business,” the report said.