Moneycontrol
Last Updated : Jun 04, 2020 01:26 PM IST | Source: Moneycontrol.com

Accumulate Eris Lifesciences; target of Rs 576: Prabhudas Lilladher

Prabhudas Lilladher recommended accumulate rating on Eris Lifesciences with a target price of Rs 576 in its research report dated Jun 03, 2020.

Broker Research @moneycontrolcom
 
 
live
  • bselive
  • nselive
Volume
Todays L/H
More

Prabhudas Lilladher's research report on Eris Lifesciences


We continue to prefer ERIS over other mid-cap companies due to 1) pure domestic play, very limited regulatory and currency risk, 2) contribution of chronic/sub-chronic products with consistent demand structure and 3) strong balance sheet. In FY20, ERIS had been in expansion mode by launching off-patent molecules, foray in new therapeutic and trade generics, in-licensing molecules and added new headcounts. However benefit from this expansion is yet to yield benefit and has led EBITDA margin to declined to 28-30% in 2HFY20 versus 37-38% in 1HFY20 mainly on account of marketing expense and increase in MR count.



Outlook


We have increased our earnings estimates for FY21E and FY22E by 6% post encouraging growth in top-10 brands, better gross margin (85%) in Q4FY20 and management guidance. Maintaining PE 21x of FY22E earnings, our new TP is Rs576 (previous Rs547) and we also change our rating to 'Accumulate' (earlier BUY) due to recent rally in stock price.





For all recommendations report, click here


Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

First Published on Jun 4, 2020 01:26 pm
Sections