Gland Pharma stock price has rallied more than 100 percent from its issue price of Rs 1,500 since November 2020 compared to more than 20 percent rise seen in the Nifty50 in the same period.
This year, too, Hyderabad-based Gland Pharma has outperformed the benchmark index, up by about 36 percent compared to over 12 percent rally in the Nifty and 15 percent gains in the BSE 200 index.
With a market capitalisation of more than Rs 52,000 crore, the Shanghai Fosun Pharma-owned Gland Pharma hit a fresh 52-week high of Rs 3,512 on May 19, 2021, and has been consolidating since then.
The stock can be bought on dips towards Rs 3,100 for a target of Rs 3,750-3,800 with a time horizon of three-six months, which translates into an upside of about 20 percent from the June 22 closing price of Rs 3,176 on the BSE.
Gland Pharma has a unique business model, where the revenue streams are majorly contributed by B2B business. The US business is a key driver with the launches like gErtapenem (partnered with DRL, FY21), gRegadenoson (FY23), gPlerixafor (FY23), gPemetrexed (FY23), gEpinephrine (FY23) and gCopaxone (fill-finish for DRL, FY23).
The vaccines opportunity—a tie-up with Sputnik—and plans to enter biosimilars is highly encouraging, experts said. Gland is better positioned to capture the injectables market opportunity in China compared to other Indian generic peers due to the backing of Fosun's commercial and regulatory muscle, they said.
Technically, since February, the stock has been in a steady uptrend with the price forming higher highs and higher lows on the daily chart. A month ago the stock hit a high of 3,515 and then saw a sideways to negative price correction.
“The recent price action has largely been contained within the bullish candle (1) of 13th May, which typically happens with a stock in uptrend. Also, low of the candle has acted as support and price has seen a bounce back,” Ashish Chaturmohta, Director Research, Sanctum Wealth Management said.
“The price has taken support at the 21-day exponential moving average (green line) and is trending higher. Price had dipped below the average but had immediately bounced back with a bullish candle and high volumes in the last trading session,” he said.
Chaturmohta further added that the Relative strength index (RSI) has given a positive crossover with its average suggesting correction is over and stock is resuming its uptrend. The stock can be bought at current levels and at dips at 3,100 with a stop loss of 3,000 for a target of 3,750-3,800 (time frame 3-6 months).
Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.