Motilal Oswal has given Buy recommendation for Strides Pharma recommended buy rating on the stock with a target price of Rs 930 in its researc with a target price of Rs. 930 in its research report issued on May 28, 2021
Motilal Oswal’s research report on Strides Pharma
STR’s 4QFY21 operational performance was marginally below our estimate. The robust performance in the US/Institutional segment within emerging markets was offset by subdued sales in other regulated markets on account of COVID-19. In addition to commercial manufacturing of the Sputnik vaccine by Oct’21, STR is building a basket of COVID-related medicines. The ANDA filing momentum is expected to pick-up in FY22, providing growth visibility in the US market.
We cut our FY22E/FY23E earnings estimate by 6% each to account for increased opex associated with logistics and increased price erosion in select products. We value STR on a 12-month forward SoTP basis – EV/EBITDA of 12x/7x/6x for the Regulated/Emerging Markets/Institutional segment – to arrive at our TP of INR930/share. Maintain Buy.