Hold Glenmark, target of Rs 214: Emkay Global

Emkay Global Financial Services has come out with a research report on Glenmark Pharma. The research firm has maintained hold rating on the stock with a target price of Rs 214, in its report dated November 16, 2009.

"Glenmark has entered into a drug development and commercialize deal with US based Medicis Pharmaceuticals for one of their NDDS based dermatological product (Acne treatment; potential market size- US $ 500 million). Glenmark has received an upfront milestone payment of US $ 5 million and expect to receive additional milestone and royalty on commercialization. We view this development as positive one for Glenmark though it will take another 2-3 years for Glenmark to have recurring earnings from this product, if launch successfully. We take US $ 5 million payment as one time impact and maintain our core business earnings of Rs 11.7 and Rs 15.3 for FY10E and FY11E respectively. At the CMP of Rs 222, the stock is trading at 19xFY10E and 14.5xFY11E. We maintain hold on the stock with a target price of Rs 214", says Emkay Global Financial Services.

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