Biocon - Rating – Buy; Target Price – Rs555 - Centrum

- We expect Biocon's revenues to grow by 21.3%YoY and by 4.8%QoQ to Rs7.69bn

- We expect the company's EBIDTA margin to improve by 60bps on YoY basis to 22.9% from 22.3%.

- Biocon launched its first in the class NCE drug Alzumab for the treatment of psoriasis in India.

- The company has licensed its oral insulin IN-105 NCE molecule to BMS for further development. Biocon has partnered with Cytosorbents, US to market Cytosorb-A for sepsis management of sepsis.

- Biocon and Mylan have received regulatory approval from DCGI to market biosimilar Transtuzumab for the treatment of breast cancer in India.

- We expect Biocon's net profit to improve by 16.7%YoY and 4.6%QoQ to Rs1,070mn.

- Our target price is based on 18x Dec'15 EPS of Rs30.8 (earlier16x Sept'15).

- Biocon stock had a sharp run during the quarter due to the above developments and better prospects for biosimilar launches in Europe as well as the re-rating of the pharma sector in recent months.

Source : Equity Bulls

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