Multi Baggers
Sanofi India
BSE ID : 500674 NSE ID : SANOFI
RECOMMENDED PRICE 6584.00
PEAK FROM RECO 9300.00 41.25%
CURRENT PRICE 8135.00 Resource id #14
Company is amongst the leading multinational companies in the Indian Pharmaceutical Market. It offers a wide array of medicines for therapy areas such as Diabetes, Cardiology, Thrombosis, Central Nervous System and Antihistamines. Also company`s key brands like Lantus, Allegra, Cardace are expected to retain strong market share going forward. Hence, we recommend ``Buy`` on the stock with price target of Rs 7480.00 for long term horizon.
Company is amongst the leading multinational companies in the Indian Pharmaceutical Market. It offers a wide array of medicines for therapy areas such as Diabetes, Cardiology, Thrombosis, Central Nervous System and Antihistamines. The products manufactured by the Company are distributed in India and exported to 51 countries (in CY17), with Germany, Australia, UK, Russia, Czech Republic and Italy ranking as the main markets. The key products exported by the Company in terms of formulations are, Paracetamol and Codeine tablets, Metformin tablets, Festal Dragees, and API's namely Pentoxyfylline and Articaine HCL.In Indian markets, company ranks at number 18 as per IMS TSA MAT December 2017 and enjoys a market share of over 1.7%. Four products of company viz. Lantus®, Combiflam®, Amaryl® and Allegra® feature in the top 100 pharmaceutical brands in India.
Strong Financial Performance: Co’s financial performance was very strong with very strong margin ratios. In Q2CY18 topline of company has posted growth of approx. 14% while bottomline of company has posted decent growth of 35% on YoY basis. In same qtr, co’s margin ratio has witnessed double digit growth with operating profit margin standing at 24.06% which was at 19.21 % in Q2CY17.Also, net profit margin of company registered whopping growth of almost 19% as it stands at 14.57% in Q2CY18 against 12.27% in Q2CY17.
Strong growth in key brands: Co’s key brands in Diabetes Therapeutic segment has witnessed double digit growth in value terms ratio CY17. Brands like Lantus, Amaryl, Insuman, Apidra has registered growth 24%, 17%, 19% & 23 % respectively in CY17 on YoY basis. Company in order to expands its consumer healthcare portfolio has introduced a new addition in the pain-care segment - Combiflam® ICYHOT™, a topical analgesic. The brand has started registering a positive trend in the market from trade as well as consumers.
The company is currently trading at 40.50x of TTM eps of Rs 162.57 while it is trading at 38.36x of CY18E eps & 32.60x of CY19E eps. Company is expected to benefit from increasing affordability among the fast growing middle class coupled with improving medical infrastructure and rising insurance penetration, better diagnosis of chronic, non- communicable diseases (like cardiovascular diseases, respiratory diseases and type-2 Diabetes). & new product launches like Combiflam® ICYHOT™. Also company’s key brands like Lantus, Allegra, Cardace are expected to retain strong market share going forward. Hence, we recommend “Buy” on the stock with price target of Rs 7480.00 for long term horizon.
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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.
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