A mid-cap pharmaceutical company named Granules India Ltd. recorded a market valuation of Rs. Today’s approx 7,356.89 crores. Granules India Limited is a Hyderabad-based Indian pharmaceutical manufacturing firm that produces APIs, PFIs and FDs for leading international corporations.
Brokerage firm ICICI Direct Research is Bullish on the stock in the 3-month target frame and has set a target price of Rs. 340 each for Granules India.
“Pharma stocks have been in the limelight since early April after being out of favor for several months as the risk-reward turned favourable. Granules share price is in a corrective phase since last six months and has formed a healthy base in last 12 weeks, thus providing fresh entry opportunity with good risk-reward setup,” said research analysts at ICICI Direct Research said in a note.
Commenting on the technical outlook of the stock, analysts said, “Structurally, the share price has retraced the 20-week rally by 62% in 24 weeks, thus factoring in the corrective nature of the fall and multiple headwinds in the process.” Slower decline after 12 weeks of base formation near key support 280 indicates that the down momentum has come to an end and some price buying is expected to emerge at the present time.”
“We expect the share price to move towards 340 in the next few months as it is a 61.8% retracement of the entire fall (381-268) in the last six months,” he added.
Commenting on the fundamental outlook of the stock, research analysts at ICICI Direct Research said, “We expect granules revenue to grow at ~14% CAGR (FY23E-25E) on the back of strong sales from key molecules such as paracetamol, ibuprofen. metformin, methocarbamol and guaifenesin. Granules’ increasing focus on API portfolio diversification, geographic diversification, backward integration could lead to margin expansion going forward. On this basis, we expect Granules’ EBITDA to grow at 15% CAGR (FY23E25E) will grow. directed to granules 600 cr for FY23, FY24 for API, backward integration and new formulations. Overall, Granules remains a decent play with a clear vision to gradually expand into more complex products/forms on the strength of economies of scale and improving margins.
Shares of Granules India closed today on NSE 303.70 each level, up 1.00% from previous close 300.70. The stock touched a 52-week high 381.00 at (04-Nov-2022) and 52-week low 226.95 at (20-Jun-2022).
Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.
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