Buy Panacea Biotec; target of Rs 231: Firstcall Research

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Buy Panacea Biotec; target of Rs 231: Firstcall Research

Firstcall Research is bullish on Panacea Biotec and has recommended buy rating on the stock with a target of Rs 231 in its December 6, 2010 research report.

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RELATED NEWS Buy Infosys Technologies; target of Rs 3230: IIFL Buy SBI; target of Rs 3150: Aditya Birla Money Buy IRB Infra; target of Rs 260: Aditya Birla Money ALSO READ See previous views by Firstcall Research See what other Experts & Brokerages are saying about Panacea Biotec See messages about Panacea Biotec Panacea Biotec BSE | NSE 30/05/12 Are Mutual Funds betting on Panacea Biotec?

Firstcall Research is bullish on Panacea Biotec and has recommended buy rating on the stock with a target of Rs 231 in its December 6, 2010 research report.

"Panacea Biotec is India's highly progressive research based health Management Company involved in research, manufacturing and marketing of branded pharmaceutical formulations, vaccines and natural products. The company has collaborated with Cambridge Biostability, U.K to develop thermo stable vaccines. During the quarter ended, the robust growth of revenue is increased by 51.78% Rs 2562.40 million. Panacea Biotec has bought back 5.5mn shares for a total consideration of Rs1090 million through internal accruals. Panacea Biotec's 'State of the Art' Pharmaceutical Formulation Facility, spanning over 10,925 m2 has USFDA approval. The company's revenue is expected to grow at a CAGR of 18% over 2009 to 2012E."

"Panacea Biotec disclosed a phenomenal rise in standalone net profit for the quarter ended September 2010. During the quarter, the profit of the company rose 7.92 times to Rs 168.70 million from Rs 21.30 million in the same quarter last year. Net sales for the quarter for the quarter jumped 51.78% to Rs 2562.40 million, while total income for the quarter jumped 53.10% to Rs 2603.80 million, when compared with the prior year period. It posted earnings of Rs 2.75 a share during the quarter, registering 8.63 times growth over prior year period."

"At the current market price of Rs 200.50, the stock is trading at 9.95 x FY11E and 8.66 x FY12E respectively. Price to Book Value of the stock is expected to be at 1.50 x and 1.28 x respectively for FY11E and FY12E. Earning per share (EPS) of the company for the earnings for FY11E and FY12E is seen at Rs 20.15 and Rs 23.16 respectively. Net Sales of the company is expected to grow at a CAGR of 18% over 2009 to 2012E. On the basis of EV/EBITDA, the stock trades at 4.26 x for FY11E and 3.76 x for FY12E. We expect that the company will keep its growth story in the coming quarters also. We recommend 'BUY' in this particular scrip with a target price of Rs 231 for Medium to Long term investment," says Firstcall Research Report.

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