ICICI Direct has recommended Hold rating on Glenmark Pharmaceuticals with a target price of Rs 730 in its research report dated July 31, 2017.
ICICI Direct's research report on Glenmark Pharmaceuticals
Revenues grew 20% YoY to Rs 2363 crore (I-direct estimate: Rs 2146 crore) mainly due to 50% YoY growth in the US to Rs 1045 crore (I-direct estimate: Rs 920 crore) led by gZetia Exclusivity. India business surprisingly grew 15% YoY to Rs 616 crore (I-direct estimate: Rs 437 crore) despite GST transition EBITDA margins increased 519 bps YoY to 24.4% (I-direct estimate: 18.6%) attributable to lower raw material, employee and other expenses. EBITDA increased 52% YoY to Rs 578 crore (I-direct estimate: Rs 399 crore).
OutlookWe reduce our FY18E, FY 19E EPS estimates by 18%, 20%, respectively. Accordingly, we arrive at our new target price of Rs 730 based on 18x F Y19E EPS of Rs 40.6.
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