Buy Strides Shasun; target of Rs 1300: Motilal Oswal
Motilal Oswal is bullish on Strides Shasun has recommended buy rating on the stock with a target price of Rs 1300 in its research report dated September 12, 2017.
Motilal Oswal's research report on Strides Shasun
The approval for Potassium Citrate Extended Release (PCER) has triggered long-awaited approvals for niche molecules for STR, in our view. Though investors like STR for its (1) niche ANDA pipeline, (2) strong regulatory compliance, and (3) credible management, they have been concerned over delay in approvals. In its 1QFY18 results concall, the company had pointed out that the delays were only procedural and that it had no regulatory issues pending. Yet, there was skepticism among investors, as STR was not getting approvals despite compliant manufacturing facilities. The PCER approval vindicates the company’s stand and would reduce investor concerns. G-Lovaza is another likely opportunity over the medium term for STR.
We recently initiated coverage on STR with a Buy rating. We remain positive, given STR’s healthy ANDA pipeline for the US market, significant value accretion potential in API business, and strong growth trajectory in Australia business. We reiterate Buy.
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