Bhavin Shah, CEO at Equirus Securities is of the view that Alembic Pharmaceuticals may touch Rs 280. "We expect 500 bps margin expansions between FY14-16 and 40 percent earnings compound annual growth rate between FY14-16," he reasoned.
Bhavin Shah, CEO at Equirus Securities told CNBC-TV18, "We continue to like Sun Pharmaceutical Industries , which was one of our top four picks for 2014, but we initiated coverage of Alembic Pharmaceuticals couple of days back. We see much bigger upside in Alembic Pharma compared to rest of the pharmaceutical stocks."
He further added, "This is a company that has transformed itself on multiple fronts and we see an upside to Rs 280 on March 2015 basis. That is going to come because we expect 500 bps margin expansions between FY14-16 and 40 percent earnings compound annual growth rate (CAGR) between FY14-16."
"This company is becoming from being purely a domestic to an international generic play and is coming up with a lot of limited competition products and overall becoming a focused company. They have increased their investments in research and development (R&D) and they are beginning to show results. The stock has been a great performer in 2013, but we think there is lot more to come in 2014 as well," Shah said.
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