Sharekhan's research report on Biocon
Biocon Biologics has entered in to definitive agreement to acquire biosimilar assets of partner Viatris. The deal would yield synergies in the long term for Biocon Biologics, but it is likely to drive up debt, thus diluting earnings in FY23. The total consideration stands at $3.34 billion split into a cash consideration (of ~$2 billion), an issue of CCPS (compulsorily convertible preference shares) of $1 billion and a deferred payment of ~$335 million.. Ability to fully realize revenues and profits of existing partnered assets, broad product portfolio, tapping new geographies for expansion would be key long term growth drivers for merged entity.
Outlook
We retain Buy on Biocon with a revised PT of Rs 420. Despite near-term pressure, long-term levers are intact and possible listing of BBL is a key positive.
More Info
At 17:30 Biocon was quoting at Rs 348.95, down Rs 45.20, or 11.47 percent.
It has touched an intraday high of Rs 397.00 and an intraday low of Rs 347.10.
It was trading with volumes of 476,751 shares, compared to its thirty day average of 187,660 shares, an increase of 154.05 percent.
In the previous trading session, the share closed up 5.36 percent or Rs 20.05 at Rs 394.15.
The share touched its 52-week high Rs 424.10 and 52-week low Rs 314.90 on 09 April, 2021 and 25 October, 2021, respectively.
Currently, it is trading 17.72 percent below its 52-week high and 10.81 percent above its 52-week low.
Market capitalisation stands at Rs 41,894.94 crore.
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