Hold Ranbaxy Laboratories, says Prakash Agarwal

Prakash Agarwal, Equity Analyst at CIMB told CNBC-TV18, "We have currently hold rating on Ranbaxy Laboratories, target price is Rs 630. Stellar performance has been driven by one offs in the US business which is largely the 180 days exclusivity on Diovan. The numbers were much better in Diovan largely because of lower price erosion than expected. So that is the surprise by around USD 40-60 million which has led to better margins because these exclusivities have very high margins.”

“If you look at the core business I think the US core business as well as the exports markets and the API market all have declined anywhere from 15 to 25 percent. So core business continues to be a drag in our view. Though it should start improving now with base margins at 10 percent, we already have factored in some margin improvement for years to come. So core business weak performance but on a reported basis stellar performance,” he added.