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Buy Cipla; target of Rs 1085: Prabhudas Lilladher

Prabhudas Lilladher is bullish on Cipla recommended buy rating on the stock with a target price of Rs 1085 in its research report dated May 11, 2022.

May 12, 2022 / 12:58 PM IST
The research firm ICICI Securities believes earnings of apparel brands and retail companies under their coverage may surprise positively from Q3FY22E as the likely demand recovery may result in better than expected margin performance. Some of the costs savings achieved during pandemic may sustain and coupled with high operating leverage may lead to higher than pre-covid margins from Q3FY22E.  Stocks like Trent, V-Mart and Aditya Birla Fashion and Retail are the preferred picks backed by their strong and consistent track record of execution.

The research firm ICICI Securities believes earnings of apparel brands and retail companies under their coverage may surprise positively from Q3FY22E as the likely demand recovery may result in better than expected margin performance. Some of the costs savings achieved during pandemic may sustain and coupled with high operating leverage may lead to higher than pre-covid margins from Q3FY22E.  Stocks like Trent, V-Mart and Aditya Birla Fashion and Retail are the preferred picks backed by their strong and consistent track record of execution.

 
 
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Prabhudas Lilladher's research report on Cipla


Cipla’s Q4FY22 performance was broad based with strong show in domestic formulation and US sales. We continue to remain positive on CIPLA’s growth across key segments including India and US given 1) strong traction in respiratory and other portfolio, 2) Ex-COVID, IPM to potentially grow +8-10% going forward with Cipla likely outpacing the market and 3) meaningful delta in US revs expected from FY23, backed by potential key launches. We expect 15% EPS CAGR over FY22-24E from base business (ex Revlimid) given resilient earnings, improving visibility from US and strong free cash flow generation.



Outlook


Our FY23/24E estimates stands reduced by 5%/2%. Maintain ‘Buy’ rating with TP of Rs1085/share based on 24x FY24E EPS plus Rs20/share for Revlimid.

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first published: May 12, 2022 12:58 pm
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