SP Tulsian positive on Lupin, Ranbaxy Labs

SP Tulsian, sptulsian.com is positive on Lupin, Ranbaxy Labs. IFCI may settle around Rs 25- 26.

Tulsian told CNBC-TV18, “IFCI, I presume that the government of India is holding two, Rs 400 crore OCD and Rs 523 crore so I presume that IFCI board must have approved for the conversion of the entire Rs 923 crore and once that happens the equity will rise to Rs 1600 crore plus, that will as also the increase equity will bring down the EPS also. So, going forward if you apply a PE multiple of maybe about 5 and price to book of maybe about 0.8-0.9 share should finally settle somewhere around Rs 25-26, so quite negative for the stock.”
He further added, “Government seems to be taking a practical view on the pharma policy as well but if you see the three sectors which have been in fact doing very well in the past first is pharma, second IT and the third is the FMCG all three sectors need some trigger. In pharma we have been seeing apprehensions on the pharma policy which is going to get considered now, the IT is correcting because of the weak dollar, strong rupee and FMCG because of the risk taking ability coming in into the traders. People are shifting from all three so probably the profit booking is justified and maybe a correction of about 2-3 percent maybe seen. In fact Cipla seems to be the most weakest stock amongst all these things but I think Lupin and Ranbaxy both have the trading potentials to bounce back. Once we will see this meeting getting over we will see the outcome which in my view will not be very negative for the whole of the industry or the sector. I will keep my positive stance on Lupin and Ranbaxy.”