Gland Pharma surges 20% as biz momentum seen turning

Mumbai: Gland Pharma shares surged 20% Tuesday's - the highest tradable limit of the day - to over a seven-month high after analysts upgraded their ratings on the stock citing an improvement in its core business, and prospects of new opportunities from its recent acquisition of Cenexi CMO.

The "worst is over" for the company," said Jefferies, upgrading the shares to a 'buy' from 'underperform' earlier, raising the target price by nearly 54% to ₹1,640. Kotak Institutional Equities upgraded the shares to 'reduce' from 'sell' earlier, increasing target price for the shares by 21% to ₹1,300. Gland shares closed at ₹1,611.05 on Tuesday. Around 6 million shares of the company were traded on the NSE, significantly higher than the average.

A better pricing environment in the US, impending product launches, and prospects of superior profitability are also seen boosting the earnings of the company going ahead, analysts said. Cenexi's financials in the June quarter showed higher gross margins as compared to Gland Pharma's core business because of certain unique products. The company has several niche and complex products which are not manufactured by Gland and will be supplied in EU and the Rest of the World.