See 50% upside in Surya Pharma: Tulsian

Tulsian told CNBC-TV18, "Surya Pharmaceutical is an established company which has six plants in Northern India and offers a wide range of products, API formulations and the fine chemical derivatives. Apart from that, they have presence in herbal products, mint and menthol derivatives as well."

He further added, "If you see their financial performance, they are already out with their Q3 results where they have posted a topline of Rs 398 crore with an EPS of Rs 1.50 paisa. Recently, the company has split the face value of share from 10 to 1. Going forward, for FY11, they should be having a topline of at least Rs 1,500 crore."

"The company has been going into forward integration as well with the pharmacy source of about 102 stores, which they already have under the brand name Viva. That is also value expansion. Their bottomline of close to about Rs 100 crore for FY11 can easily move to Rs 125 crore. They should be able to post a growth of 25% in FY12 over the expected bottomline of about Rs 100 crore, which they are likely to post for FY11 considering their nine months result."

"The share is ruling presently at about 23. If I take an EPS of about Rs 560-570 for FY11, it is ruling at a PE multiple of about close to 4 times. In such a case, I don’t think even if you take this company as a pure API play, it doesn’t deserve a PE multiple of 4 times. So, maybe in a year’s time one can see at least 50% rise from the current share price at what it is ruling."