Accumulate Pfizer; target of Rs 1417: Emkay

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Accumulate Pfizer; target of Rs 1417: Emkay

Emkay Global Financial Services is bullish on Pfizer and has recommended accumulate rating on the stock with a target of Rs 1417 in its May 4, 2011 research report.

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RELATED NEWS Buy Rallis India; target of Rs 1706: KRChoksey Sell IOB; target of Rs 125-120: Aditya Birla Money Accumulate Godrej Consumer; target of Rs 447: Angel Broking ALSO READ See previous views by Emkay Global Financial Services See what other Experts & Brokerages are saying about Pfizer See messages about Pfizer Pfizer BSE | NSE 30/05/12 Are Mutual Funds betting on Pfizer?

Emkay Global Financial Services is bullish on Pfizer and has recommended accumulate rating on the stock with a target of Rs 1417 in its May 4, 2011 research report.

"Pfizer, muted performance by Pfizer with a) Revenue up by 12.3%* to Rs 3.1 billion, b) EBIDTA up by 2%* to Rs 703 million and c) APAT increased by 12%* to Rs 631 million. Pharma revenue growth lower than industry growth of ~16% due to lower growth in Becosules. Company declared dividend of Rs 16.50 per share for 16 month period with dividend yield of 1.3%. During Dec'09-Mar'11, revenues grew at 12% to Rs 3.1 billion driven by 9.1% growth in pharma segment (cont. 79% of the business), 6.3% growth in Animal healthcare business (cont. 13% of the business), 267% growth in Clinical services business. (cont. 7% of the business). Lower growth in Pharma segment is due to decline in sales of one of its top brand Becosules . Excluding Becosules, the pharma revenue grew by 12%.There was a trade scheme last quarter which over filled the distribution channels and as a result lower sales this quarter. This will come back to normal next quarter."

"Company has added 100% field force in last one and a half year to 2500, which has still to produce the results. This field force will be focused on tier II and tier III cities where Pfizer has week performance. Going forward company is focusing on branded generics and filling the gaps in its portfolio. This year company will launch the insulin products for which they have inlicensing agreement with Biocon. Company is confident of good number of new products launches every quarter to cover up the gaps in its portfolio and catch up the industry growth We expect Pfizer to report 14% revenue growth in FY 12 and 16 % in FY13. We expect company's EBITDA to improve from 20.8% in FY11 to 21.6% in FY12 and further improve to 22.1% in FY13. We value Pfizer at 18x FY13 EPS of Rs 78.7 to arrive at a target price of Rs1417 and maintain accumulate rating. At CMP of Rs 1247, the stock is trading at 18.8x FY12E and and 15.8x FY13E earnings respectively," says Emkay Global Financial Services research report.

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