Axis Securities's research report on BioconBiocon’s PAT was in line with our estimate led by 23% YoY growth in its Contract Research business (Syngene). Despite R&D expenses increasing 45% YoY (12% of Biopharma sales), EBITDA margin expanded 180 bps YoY to 22% led by licensing income received from out licensing Trastizumab in EM. Biocon’s R&D efforts are on track as it expects to file four biosimilar products (addressing USD 30 bn market) in CY16 and progressing further with development of oral insulin (Tregopil). We highlight Biocon’s base business and niche biosimilar pipeline are underappreciated by the Street as the company (ex-Syngene^) trades at attractive valuation of 14.4x FY17 EPS. Maintain BUY withTP of Rs650 (20x FY17E EPS for base business and Rs 132 for biosimilar pipeline) given increasing regulatory visibility and advancing R&D pipeline. For 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.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
