Buy Biocon; target of Rs 495: Sharekhan

Sharekhan's research repor on Biocon

Q2FY2021 was a soft quarter for Biocon. Revenues from operations grew by 11% y-o-y to Rs 1,745 crore. Adjusted PAT rose by 10.3% y-o-y to Rs. 173.8 crore. Improving traction in existing biosimilars, likely pick up in Semglee, geographical expansion are the key growth drivers for Biologics segment. Biocon has retained its guidance for $1 billion in revenues from the biologics segment by FY2022. The generics business too is expected to grow at a healthy pace driven largely by formulations. Possible listing of Biocon Bilogics provides value unlocking opportunity.

Outlook

We retain Buy recommendation on the stock with a revised PT of Rs. 495.