Motilal Oswal's research report on Gland Pharma
Gland Pharma (GLAND) posted better-than-expected 1QFY24 performance. After a lackluster 4QFY23, GLAND has exhibited an improvement in business from core markets as well as stability in India/ROW businesses. The overall performance has improved to some extent due to higher profit share component as well for the quarter. We raise our earnings estimates by 8.5%/5.0% for FY24/FY25 factoring in: a) faster revival of the lost business by adding new customers, b) price stability in the base portfolio, and c) increase in milestone income. We value GLAND at 23x 12M forward earnings to arrive at our TP of INR1,560. GLAND remains on track to not only revive the base business but also to: a) increase its offerings in newer markets like China, b) build niche pipeline for regulated markets, and c) enhance scope of synergy from Cenexi acquisition. Reiterate BUY.
Outlook
We raise our earnings estimates by 8.5%/5.0% for FY24/FY25 factoring in: a) faster revival of the lost business by adding new customers, b) price stability in the base portfolio, and c) increase in milestone income. We value GLAND at 23x 12M forward earnings to arrive at our TP of INR1,560.
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