Buy Natco Pharma; target of Rs 930: Anand Rathi

Anand Rathi is bullish on Natco Pharma has recommended buy rating on the stock with a target price of Rs 930 in its research report dated November 13, 2018.

Broker Research

November 16, 2018 / 16:53 IST

26 Aug, 2025 12:21

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Anand Rathi's research report on Natco Pharma

Focus on oncology, new entrant in CnD division in domestic formulations. In domestic formulations, Natco is focusing on oncology and entered CnD (cardiology, diabetology) in early 2017, where its focus is on niche molecules with high entry barriers. It enjoys a strong brand in oncology (six brands with more than `100m revenue) and Hepatitis C. Within oncology, it offers a range of brands catering to various oncological diseases, of the breast, brain, bone, lung and ovaries. In CnD, the launches could be either at-risk, settlement with innovators for launches prior to Day-1 or complex limited-competition ones (Argatroban). Overall, we expect a ~16% CAGR in revenue over FY18-21, with a targeted launch of 8-10 products a year.

Outlook

We retain our Buy recommendation and roll forward our price target to FY21 at a revised target of `930 (earlier `937), based on a sum-of-parts method. We value the base business at `757, based on 20x FY21e earnings, and the Para-IV opportunity at `173.

For all recommendations report, click here