Shares of Glenmark Pharma plunged more than 6 percent after brokerage Bank of America Merrill Lynch (BoAML) downgraded the stock to underperform with revised target price of Rs 1,200 apiece. The stock rallied 56 percent in the last six months. The brokerage believes Glenmark is fully valued at its target September 2017 P/E of 21x. Yet, BoAML valued stock at a 10 percent discount to large peers, given its relative business size compared to large peers, lower return profile and leveraged balance sheet against peers.
It believes the FY17 expected price-to-earnings at a 25 percent premium to its one-year average priced in strong growth momentum in the US as well as India, margin expansion in the core business, and potential improvement in the balance sheet. It expects company's core profit after tax to double over FY15-18, driven by 19 percent sales CAGR and 300 basis points margin expansion over the same period.
Although global markets saw a major correction today, followed by further correction in the Asian markets, Michael Kurtz Chief Asia Equity Strategist, Nomura is not overly worried of US growth going forward. According to him, US is still looking good with strong home and auto sales data and does not think there is a strong case for a deep correction in US equity markets. Within the Asian region ex-japan, he is worried about the Chinese growth but is optimistic on India. India, he says is the top pick for the house and largest overweight. Moreover, falling commodity prices and oil is aiding India and keeping us more positive on it, says Kurtz.
For Quick Trial – 8962000225 ✔
or mail us here: info@ways2capital.com
or visit http://www.ways2capital.com
✆ - 0731-6554125 | Toll Free - 1800-3010-2007
Give a Missed Call for Free Trial - 09699997717
0 comments:
Post a Comment