Monday 10 November 2008

Buy Ranbaxy Labs, target of Rs 316: Angel

Angel Broking has maintained its buy rating on Ranbaxy Laboratories with a target of Rs 316 in its October 31, 2008 research report. "For the quarter, the company posted Net Sales of Rs 1,882 crore, registering a yoy growth of 14.7%. At current valuations, the stock trades at 15.6x CY2008E and 10.0x CY2009E earnings, a deep discount to its historical valuations."

"While the stock would remain lackluster in the near term, we believe that at current valuations, the stock discounts the concerns fairly well. Thus, we maintain our BUY recommendation on the stock with an 18-month revised SOTP Target Price of Rs 316 (Rs 410), wherein the core business is being valued at a P/Ex of 16x CY2009E core earnings (multiple lowered on back of lower visibility on the US business) giving it a fair value of Rs 218, Rs 24 for the non-core income and Rs 75 has been ascribed to NPV of the FTF opportunities available to the company," says Angel Broking's research report.

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Source: Moneycontrol

Posted by Harsh at 12:42

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