Company Background :
Biocon Limited is a biopharmaceutical company. The Company focuses to reduce therapy costs of chronic diseases like autoimmune, diabetes, and cancer. Through its products and research services it is enabling access to affordable healthcare for patients, partners and healthcare systems across the globe. The Company has developed and taken a range of Novel Biologics, Biosimilars, differentiated Small Molecules and affordable Recombinant Human Insulin and Analogs from Lab to Market.
Company’s brands include INSUGEN (rh-insulin), BASALOG (Glargine), CANMAb (Trastuzumab), BIOMAb-EGFR (Nimotuzumab) and ALZUMAb (Itolizumab), an anti-CD6 monoclonal antibody. It has a pipeline of Biosimilars and Novel Biologics at various stages of development, including Insulin Tregopil, an oral insulin analog. Source - Investing.com
Financial Performance :
Biocon is India’s largest biologics company and an established player in research business. In FY17, small molecules, CRO, branded formulations and biologics contributed 41%, 29%, 14% and 12% respectively and the rest 4% came from the licensing fees. In India, it is the largest biologics company and has products like INSUGEN, BASALOG, CANMAb, ALZUMAb, etc. Geographically, India contributes 30% of total revenue and 70% of revenue comes from overseas markets.
Biocon’s early entry in the biosimilars business is positive for the company. The company, with its partner Mylan, is developing total 10 biosimilars, of which 3 (Pegfilgrastim Trastuzumab and Insulin Glargine) are submitted for regulatory submission. Company’s research business i.e. Syngene, in the last year has signed two new dedicated clients and has undertaken a capex of $200mn to expand its capabilities and forward integrate. This will help Biocon to grow its profit 6x over next five years. We expect 31.7% and 73.7% CAGR in revenue and PAT over FY18E-20E. Biocon is expected to witness 38.6% EBITDA CAGR during this period. Source 5paisa.com
During the last 1 year the scrip has given following returns
The scrip has touched a low of 247 and a high of 472
1 year - minus 93.95%
6 months - minus 14.63%
3 months - minus 10.32%
1 month - 22.48%
1 week - 6.15%
Buy and add to your long term portfolio. In the short term 700 will be a good resistance point. The scrip may correct in the short term, and Rs.625 is the support level in case of a correction. Hold long ter fo ra Target price of 765 in next 12 months and 925 for 18 months holding in view of the revenue and profit visibility.
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