Multi Baggers

Ajanta Pharma
 
Ajanta Pharma has launched 23 new products in different therapeutic segments during the year, out of which 12 were ‘first of its kind’ in the country. All the products, developed by the in house R&D team, were unique, providing the much needed relief to the ailing patients.

In domestic market, the company continued its leadership in speciality segments in which it operates viz. Ophthalmology, Cardiology and Dermatology. Many of its products enjoy leadership position in their sub segments, being amongst the top five brands in the country.

The company has registered decent numbers for the quarter ending March 2011. A decent increase of about 30% in the sales to Rs 1273.08 millions was observed for the quarter ended March 2011. The sales figure stood at Rs 982.87 million during the year ago period. The Company has registered profit of Rs 125.31 million for the quarter ended March 2011, zoomed 80% over Rs 69.79 million achieved in the corresponding quarter of last year. Operating profit surged to Rs 212.82 million from the corresponding quarter previous year of Rs 178.57 million.

Ajanta’s presence in the continents of Asia, Middle East, Africa and Latin America, gives it an advantage in terms of market spread and huge growth potential.

Many of Ajanta’s products continue to enjoy leadership position in their segments, being amongst the top five brands in the country.
 
Valuation:

Presently, the stock is trading at Rs 318 which is at a consolidated PE of around 5.89x and 4.95x to its FY12E and FY13E EPS of Rs.52.99 and Rs.63.07 respectively. Since the stock offers good investment opportunity, we initiate a ‘BUY’ signal on the stock with a target price of Rs 400 expecting an appreciation of about 28% from the current level with the medium to long term investment horizon.

Disclaimer:

This document is prepared on the basis of publicly available information and other sources believed to be reliable. Whilst we are not soliciting any action based on this information, all care has been taken to ensure that the facts are accurate and opinions given fair and reasonable. This information is not intended as an offer or solicitation for the purchase or sell of any financial instrument. Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited and any of its employees shall not be responsible for the content. The companies and its affiliates, officers, directors, and employees, including persons involved in the preparation or issuance of this material may from time to time, have long or short positions in, and buy or sell the securities there of, company (ies) mentioned here in and the same have acted upon or used the information prior to, or immediately following the publication.