Ipca Laboratories - Getting Back to Top Gear - Citi

Citi has come out with a Buy report on Pharmaceuticals company Ipca Laboratories Ltd. Citi has initiated Buy on the stock with a target price of Rs.450.

Citi has mentioned in the report that, the stock is attractive at 11x FY13E EPS, given healthy EPS CAGR of 25% (sector:24%), strong cash flows & improving return ratios. Citi has initiated the Buy call at a price of Rs.353.70 as on April 23, 2012, with an expected target price of Rs.450 expecting a share price return of 27.2% from the price on initiation day.

Citi also mentioned that the target multiple is at a 30% discount to what it uses for sector leaders such as Dr. Reddy's Laboratories and Lupin. Citi also expects a likely re-rating of the stock over the next 12 months, as the concerns over growth in India & US have suppressed the current multiple.

Source : Equity Bulls

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