Religare Research has maintained its buy rating on Biocon with a target price of Rs 430 in its July 21, 2008 research report. "Biocon's Q1FY09 results were below estimates as contract services witnessed another flat quarter and the absence of licensing income caused a sharp contraction in EBITDA margin. The company booked Rs 64 million as forex losses for the quarter and made a provision of Rs 255 million towards mark-to-market (MTM) losses, which had a significant impact on profitability. The only silver lining was a 19% YoY growth in the biopharma segment driven by the growth in non-statin product portfolio."

"While we do not see any near-term triggers for the stock, over the longer run (18–24 months), Biocon's business offers triggers in terms of the launch of biosimilars in the EU, licensing out of its lead diabetes and psoriasis molecules, increasing penetration of branded formulations (target of Rs 5bn-plus in sales by 2010), and listing of Syngene. The stock is trading at 11.4x FY10E earnings and offers limited downside from these levels. We have revised our estimates for FY09 and FY10 to incorporate a change in our licensing income numbers as well as integration of AxiCorp. We thus maintain Buy but reduce our target to Rs 430 (14x FY10E earnings) from Rs 573," says Religare's research report.

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