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SENSEX: 39058.83 94.99

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Multi Baggers

Hem Securities

12.00 AM Aug 31st 2018

Abbott India

BSE ID : 500488     NSE ID : ABBOTINDIA

RECOMMENDED PRICE 7958.00

PEAK FROM RECO 11296.95 41.96%

CURRENT PRICE 10913.30 37.14%

Abbott India, part of Abbott`s Global Pharmaceutical business, is one of India`s most admired and fastest-growing pharmaceutical companies. Company`s robust plan to launch 100 new products over period of five years coupled with strong sectoral outlook makes stock an attractive destination to deploy the funds in at current level. Hence, we recommend ``Buy`` on the stock with price target of Rs 9560.00 for long term horizon.

Abbott India, part of Abbott’s Global Pharmaceutical business, is one of India’s most admired and fastest-growing pharmaceutical companies. Co provide products across various therapeutic categories such as Women’s Health, Gastroenterology, CNS, Metabolics, General Care, Vitamins, Vaccines, etc. Co’s products are manufactured in India and also sourced from local third-party manufacturers in India.

Strong growth & leadership position in some brands: As company restructured its product portfolio in key business areas –Women’s Health, Gastroenterology, Consumer Care, CNS, Metabolics, General Care & Vaccines among which, women’s health grew by 19.1%, Vaccines grew by 59.7% and Metabolics grew by 15.3% in FY18. Company have been able to grow at 1.6 times the market. Co’s top 10 brands are leaders (at number 1 or 2 position) in their respective segments. Co’s Thyronorm brand (for thyroid preparations) Influvac (influenza vaccine) retains leadership position with more than 50% market share.

Healthy Financial Performance: Company has posted strong growth in Q1 FY19 with topline of company displaying decent YoY growth of 20% at Rs 845 Cr while bottomline of company has witnessed whopping YoY growth of 70% at Rs 84 Cr.

New Product launches: Co launched 21 new products in FY18 and aims to launch around 100 products over the next five years as company looks to strengthen existing therapy areas such as gastroenterology, metabolics, vaccines, central nervous system and women's health. As the OTC market is growing strongly at 10.2 % & with the creation of a well-defined & regulated OTC market, coupled with stricter enforcement of prescribing & dispensing regulation, OTC market is all set to achieve growth in coming future. Hence company intends to strengthen its over-the-counter portfolio with a wider range of product profiles.

The company is currently trading at 38.84x of TTM eps of Rs 204.90 while it is trading at 29.77x of FY19E eps & 25.32x of FY20E eps. Company’s fundamentals looks quite strong with zero debt in its book. Company’s robust plan to launch 100 new products over period of five years coupled with strong sectoral outlook makes stock an attractive destination to deploy the funds in at current level. Hence, we recommend “Buy” on the stock with price target of Rs 9560.00 for long term horizon.

For more detail's click on the attachment

Disclaimer & Disclosure: This document is prepared for our clients only, 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, fair and reasonable. This information is not intended as an offer or solicitation for the purchase or sell of any financial instrument and at any point should not be considered as an investment advice. Reader is requested to rely on his own decision and may take independent professional advice before investing. Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited, Directors and any of its employees shall not be responsible for the content. The person accessing this information specifically agrees to exempt Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and further agrees to hold Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. 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 herein and the same have acted upon or used the information prior to, or immediately following the publication.

Abbott_india_Hem.pdf

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