We feel investors could buy the stock at the CMP and add on dips to Rs ~221-225 band (14.0x CY20E EPS) for sequential targets of Rs 287 (18.0x CY20E EPS) and Rs 303 (19.0x CY20E EPS). At the CMP of Rs 250 the stock trades at 15.7x CY20E EPS.
With three European and two US approvals in place, Biocon is in the first row when the monetisation cycle of biosimilars began. Looking ahead, we expect the biosimilars will penetrate faster in the US healthcare industry with rising interest to adopt biosimilars.
Carborundum Universal (CUMI) Q4 and FY19 earnings were in-line with our estimates. Q4 earnings dropped by 6% YoY to Rs. 3.27 due to lower demand which was unusual for a year end quarter (low than Q3 volumes).
Prataap Snacks – a key player in the Organized Snacks market, has transformed itself from a regional snacks player to a PAN India player, with its market share quadrapulating from <1% in 2008 to 4%+ in 2018.
We believe revenue to grow at a CAGR of 8.7% over the period of FY19-FY21E. We expect execution of pushed out deals and investments made in developing new technology solutions to contribute significantly to the revenue growth in the coming years.
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