Published on 9/10/2018 10:17:39 AM | Source: Reliance Securities Ltd

Buy Ajanta Pharma Ltd For Target Rs.1,360.00 - Reliance Sec

Posted in Broking Firm Views - Short Term Report| #Pharma Sector #Ajanta Pharma Ltd #Trading Report #Reliance Securities Ltd


* Ajanta Pharma (AJP) closed 1.2% higher compared to fall of 2.7% in benchmark NIFTY.

* We believe that AJP’s long-term fundamentals continue to remain healthy driven by strong traction in India business and healthy growth in Asia and the US led by new launches.

* We envisage AJP’s domestic formulations business to clock 14.9% CAGR over FY18-20E led by improved sales force productivity and new launches (15-20/annum).

* We expect strong recovery in sales and earnings in FY20E with sales and PAT growth of 14.3% YoY and 40% YoY, respectively. Return ratios are also expected to remain healthy (RoCE & RoE seen at 22% & 18%) in FY20E.

* We maintain our BUY recommendation on the stock with a Target Price of Rs1,360, valuing at 24x FY20E EPS of Rs56.7.


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