Biocon hits new high; stock zooms 109% in one year

Biocon (Photo: Wikipedia)
Shares of Biocon hit a new high of Rs 718 per share, up 2% on Wednesday, extending their 6% rally on Tuesday on the BSE in an otherwise subdued market after the company said the inspection of its drug substance manufacturing site at Bengaluru campus by the US health regulator has concluded without any observations.

“The US Food and Drug Administration (USFDA) conducted a periodic current Good Manufacturing Practices (cGMP) inspection of our drug substance manufacturing site at Bangalore Campus from September 17 to 21, 2018. The weeklong audit concluded without any observations and no Form 483 was issued,” Biocon said in a regulatory filing on Saturday.

"The successful audit of this site reflects our strong commitment to cGMP compliance," a spokesperson said.

In past one year, the stock of biotechnology firm has zoomed 109% as compared to a 16% rise in the S&P BSE Sensex. In the past two months, post the April-June (Q1FY19) results, Biocon has outperformed the market by gaining 28% against a 1% decline in the benchmark index.

Analysts at ICICI Securities have ‘buy’ rating on the stock with 12-month target price of Rs 740 per share.

“As expected, the beginning of FY19 was on a strong footing mainly due to continuous strong traction in its “growth segments” (Biologics and Syngene). The management has sounded confident on achieving US$200 million sales from the Biologics segment by FY19. Progress in biosimilar approvals/launches in developed markets is also promising,” the brokerage firm said in a result update.

Although these approvals do not imply immediate launch of the product in these regions, it endorses the development and manufacturing capabilities of Biocon in the realm of biosimilars. Progress on the biosimilars regulatory front in developed markets and launches in the developed, as well as emerging markets, are likely to maintain investor’s optimism for the company, it added.

At 09:44 am; Biocon was trading 1.7% higher at Rs 714 on the BSE, as compared to 0.02% decline in the S&P BSE Sensex. A combined 1.45 million equity shares changed hands on the counter on the NSE and BSE so far.

 



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