Buy Biocon; target of Rs 640: Axis Securities

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26 Aug, 2025 12:21

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Axis Securities's research report on BioconWe highlight Biocon’s base business and biosimilar pipeline are underappreciated by the Streetandthe company (ex-Syngene^) trades at attractive valuation of17x FY17 EPS (see Exhibit 15). While we expect Biocon’s base business to improve gradually, it seems well-positioned to monetize the biosimilar opportunity (over USD 70 bn patent expiry by 2025) given it is developing strong biosimilar pipeline (5 mAbs /3 insulins) with Mylan to ensure long-term growth. We assign Rs 132/shas R&D value for glargine, trastuzumab, adalimumab and pegfilgrastim for Biocon. Thiscould increase with better regulatory visibility and advancement in R&D pipeline. Maintain BUY with revised TP of Rs 640[Rs 508(20x FY17E EPS) for base business and Rs 132 for biosimilar pipeline] vs. Rs 535 earlier.While Biocon has underperformed peers due to muted financials in the past, we expect growth to accelerate from FY18, driven by insulin supplies from new Malaysia facility (capex of USD 200-250mn completed) for emerging markets and ramp-up of insulin/biosimilars in regulated markets expected to start from FY19/20For all recommendations, 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.

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