Buy Alkem Laboratories, target price Rs 4030: Motilal Oswal

Motilal Oswal has buy call on with a target price of Rs 4030. The current market price of Alkem Laboratories Ltd. is Rs 3461.05. Time period given by analyst is one year when Alkem Laboratories Ltd. price can reach defined target.

Alkem Laboratories Ltd., incorporated in the year 1973, is a Large Cap company (having a market cap of Rs 42329.60 Crore) operating in Pharmaceuticals sector.

Financials
For the quarter ended 30-06-2021, the company reported a Consolidated Total Income of Rs 2778.01 Crore, up 24.10 % from last quarter Total Income of Rs 2238.44 Crore and up 35.71 % from last year same quarter Total Income of Rs 2046.99 Crore. Company reported net profit after tax of Rs 480.23 Crore in latest quarter.

Investment Rationale
The brokerage continues to value ALKEM at 23x 12M forward earnings to arrive at TP of INR4,030. It maintains positive stance on ALKEM on the back of a) an established brand franchise in the Acute category, b) enhanced efforts to improve growth prospects in the Chronic category, and c) a healthy ANDA pipeline comprising limited-competition products.

Promoter/FII Holdings
Promoters held 58.8 per cent stake in the company as of June 30, 2021, while FIIs held 4.5 per cent, DIIs 14.5 per cent and public & others 22.2 per cent.