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Buy Cadila Healthcare, target price Rs 330: CLSA

The brokerage said HCQS could be a huge near-term opportunity for Cadila.

ETMarkets.com|
Last Updated: Mar 23, 2020, 07.45 AM IST
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CLSA has retained buy rating on Cadila Healthcare in the long term with a target price of Rs 330. Shares of Cadila Healthcare ended up 16.4% at Rs 286.1 on Friday while the BSE Sensex closed 1627.73 points up (+5.75%) at 29,915.96.

Investment Rationale

Cadila asserted that it has ample capacity for hydroxychloroquine (HCQS), a drug being tested by USFDA for potential treatment of coronavirus, and it can step in quickly if required, said CLSA. The brokerage said HCQS could be a huge near-term opportunity for Cadila.

Financials

Cadila Healthcare's key products/revenue degments include pharmaceutical pProducts which contributed Rs 6m207 crore to sales value (95.59 per cent of total sales), Export Incentives which contributed Rs 169.30 crore to sales value (2.60 per cent of total sales) and other operating revenue which contributed Rs 116.40 crore to sales value (1.79 per cent of total sales)for the year ending March 31, 2019.

For the quarter ended December 31, 2019, the company reported consolidated sales of Rs 3534.50 crore, up 8.95 per cent from last quarter sales of Rs 3244.20 crore and up 0.52 per cent from last year same quarter sales of Rs 3516.10 crore. The company reported net profit after tax of Rs 364.40 crore in the latest quarter.

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