Motilal Oswal's research report on Gland Pharma
GLAND’s 1QFY22 performance was ahead of our expectation, led by robust revenue growth across all geographies. It is progressing well on scaling up manufacturing of the COVID-19 vaccine. It is concurrently developing products/undertaking capex related to complex product as well as enhancing its geographical diversification. We raise our FY22E/FY23E EPS estimate by 8% each to factor in: a) increased reach as well as penetration in the RoW/India markets, b) better outlook for the US market, c) higher offtake of Remdesivir/Enoxaparin, and d) continued manufacturing efficiency driving better operating leverage.
We value GLAND at 35x its 12 months forward earnings to arrive at our TP of INR4,460. We remain positive on GLAND due to its: a) superior ramp-up in existing products, b) healthy build-up in the complex product pipeline, c) ongoing investment in the vaccine/Biological space, and d) enough scope for inorganic growth as well. We reiterate our Buy rating.
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