Motilal Oswal is bullish on Granules India recommended buy rating on the stock with a target price of Rs 765 in its research report dated July 18, 2020.
Motilal Oswal 's research report on Granules India
Post delivering spectacular earnings growth (76% YoY) in FY20, Granules India’s (GRAN) posted strong revenue/EBITDA/PAT in 1QFY21. This was led by new launches in formulations (FDs) and better market penetration for intermediates (PFIs). We have raised our EPS estimate by 12%/6% for FY21/22E to factor in (a) the increased FD business on account of ANDA launches in the US, (b) addition of new molecules in the API segment, (c) increased traction in existing products, and (d) improving profitability due to backward integration. We value GRAN at 14x 12M forward earnings to arrive at price target of INR315. Re-iterate Buy.
Outlook
We value GRAN at 14x 12M forward earnings to arrive at a TP of INR315/share. Maintain Buy.
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