is one of the leading research-driven pharmaceutical manufacturing companies in India. The company has grown to become one of the leading manufacturers of API for anti-retroviral (ARV), oncology, cardiovascular, anti-diabetics, anti-asthma, and gastroenterology.
Analysts at ICICI Securities have 'buy' rating on the stock with a target price of Rs 1,620 per share. The brokerage firm expects the Contract Development & Manufacturing Organization (CDMO) segment to exhibit strong growth on the back of customer additions. Laurus, it says, is well poised to follow the success story of some leading CDMO players backed by strong chemistry and integrated model.
Laurus has shown strong improvement in performance, with profit after tax doubling to Rs 250 crore in FY20 and coming in at Rs 170 crore in 1QFY21. Motilal Oswal Financial Services expects 2.7x FY20 earnings for FY21, primarily led by a doubling of formulation sales, 30 per cent year on year growth in each API and CDMO segment supported with 780 basis points margin expansion.
The brokerage firm remains positive on Laurus Labs on the back of superior execution across revenue segments, resulting in expansion of ROE to 27 per cent (from 15 per cent in FY20) and sufficient levers to sustain the earnings momentum over the medium term.
At 10:23 am, the stock was trading 5 per cent higher at Rs 1,395 on the BSE, as against 0.93 per cent rise in the Sensex. Around 647,000 equity shares were changing hands on the counter on the NSE and BSE.
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