Daljeet S Kohli, Head of Research at Indianivesh Securities told CNBC-TV18, "For Indoco Remedies the target is Rs 392, the basic call here again is this story is very well-known, almost last six-seven months everybody has looked at this company and that US business will come. Now the basic thing will be execution from here onwards. They have already got two approvals from US. There are another 17 products pending waiting for an approval from that. So just for these two products, the numbers right now are looking like the growth from US business is so substantial and if the other products get added, obviously next three-four years - this will be a story for many more years to play as and when these approvals will come.”
“On the domestic part, the thing is they are right now into only the acute category, which is not growing very soft and where the margins are stable or very low still they have been growing near the industry average 12-14 percent. Now they are moving towards chronic segment which is a big growth area. Most of the companies are in that region. So if they are able to get some more market share there, again they will have a combined effect of US and India business doing very well in next two-three years. Execution will be the key thing to watch out. We are banking that this company has capability of doing that and though the stock has already moved in terms of valuations from 12-18 times, we think that it can easily go up to 20-22 times as the larger peers do,” he added.
Disclosure: Analyst holds Pennar Industries.
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