Buy Shilpa Medicare; target of Rs 520: Sharekhan

Sharekhan's research report on Shilpa Medicare

SML reported weak performance for Q3FY2021 with results missing estimates. However, SML’s growth prospects are healthy and performance is expected to improve. The Erosion in the US business due to receipt of the warning letter is likely to be offset by growth in other geographies, new product pipeline. SML’s strategy of building a high-value oncology pipeline for regulated markets and foray into biosimilars/biologics, coupled with focus to pursue opportunities in CDMO & Vaccines space would play out well and support growth.

Outlook

We retain our Buy recommendation on Shilpa Medicare Limited (SML) with a revised PT of Rs. 520.