Buy Shilpa Medicare; target of Rs 1140: Firstcall

Firstcall Research's report on Shilpa Medicare"The company’s a turnover of Rs. 1438.57 million registering an increase of 13.52% for the 1st quarter of the financial year 2016 as against Rs. 1267.26 million in the corresponding quarter of the previous year. In Q1 FY16, net profit stood at Rs. 212.80 million against Rs. 190.35 million in the corresponding quarter ending of previous year, and increase of 11.79% y-o-y. The company reported earnings per share of the company stood at Rs. 5.52 a share during the quarter as against Rs. 4.94 over previous year period. Profit before interest, depreciation and tax is Rs. 334.65 million as against Rs. 321.71 million in the corresponding period of the previous year."Outlook And ConclusionAt the current market price of Rs. 970.00, the stock P/E ratio is at 40.13 x FY16E and 37.13 x FY17E respectively.Earnings per share (EPS) of the company for the earnings for FY16E and FY17E are seen at Rs. 24.17 and Rs. 26.12 respectively.Net Sales and PAT of the company are expected to grow at a CAGR of 20% and 22% over 2014 to 2017E respectively.On the basis of EV/EBITDA, the stock trades at 23.92 x for FY16E and 22.02 x for FY17E.Price to Book Value of the stock is expected to be at 5.50 x and 4.67 x respectively for FY16E and FY17E."We expect that the company surplus scenario is likely to continue for the next three years, will keep its growth story in the coming quarters also. We recommend ‘BUY’ in this particular scrip with a target price of Rs 1140 for Medium to Long term investment", says Firstcall Research Report.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.

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