The shares of this leading pharmaceutical developer in APIs gained 3.6% to ₹894 apiece after HSBC upgraded the target price with an upside potential of 25%.
Glenmark Pharmaceuticals Ltd shares have gained a multibagger return of 105% in the last six months and 15% in the last six months.
Glenmark Pharmaceuticals Ltd is one of the leading developers and manufacturers of high-value Active Pharmaceutical Ingredients. The company operates in Contract Development and manufacturing operations of specialty Pharmaceutical products.
Further, the company is a leading developer and manufacturer of high-value, non-commoditized, Active Pharmaceutical Ingredients (APIs) in chronic therapeutic areas.
In Q2FY24, gross margins increased by 120 basis points YoY to 54.1%, while EBITDA margins decreased by 120 basis points YoY to 29.0%, owing to greater labor expenses and improved gross margins.
Regulated markets contribution is at 80% of firm revenue in Q2FY24 driven by growth in the US, LATAM, Europe, and India. The company planned to add 208KL manufacturing capacity in FY24 at Ankleshwar, Gujarat.
The company’s operational revenue has declined by 19 percent year on year from ₹3,100 crore in Q3FY23 to ₹2,507 crore in Q3FY24, while net profit reduced from a profit of ₹ 291 crore to a loss of ₹331 crore.
HSBC upgraded a target on Glenmark Pharmaceuticals Ltd. The brokerage has revised a target to ₹1,100 per share, representing an upside of 25 percent from Tuesday’s trading price of ₹883 per share.
In 3QFY24, Glenmark Pharma reported a disrupted quarter due to the restructuring of the distribution model, HSBC said. The company made changes to its distribution model for its India formulation business. As a result of this restructuring, there is a recovery in Indian sales.
The brokerage anticipates that lower R&D spending and the commencement of supplies from the Monroe Plant bode will help the company for margin expansion. Glenmark Pharma has multiple margin drivers, and Glenmark Life Science may act as a catalyst for growth.
Written by Omkar Chitnis
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
