Views on Lupin has taken price rise in Fortamet: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research - Pharma, Angel Broking)

Lupin has taken price rise in Fortamet:

"Lupin has been reported to have taken 200% price increase in Fortamet. This has come after, a huge price hike in competing product Glumetza. After the hike, Fortamet is still 75% cheaper than Glumetza. Though the sustenance of price hike can't be predicted as other Fortamet is genericised & can see additional competition. The product should have an estimated market size of around US$100-130mn and Lupin sales according to our estimates should be around US$43mn, with a price hike the product should be grossing sales of US$70-80mn. Even after the hike the product contribution to the overall sales would be around ~3% of the overall sales in FY2017E. However given the huge price hike, the OPM's could see an expansion of 225bps and result in the EPS expansion of 13% and 12% in FY2016E and FY2017E respectively. However, even after the upgrade; if the earnings growth sustains, the valuations are too rich for any upgrades. Thus, maintaining our neutral stance on the stock."

Shares of LUPIN LTD. was last trading in BSE at Rs.1989.45 as compared to the previous close of Rs. 1921.3. The total number of shares traded during the day was 185861 in over 10706 trades.

The stock hit an intraday high of Rs. 2002 and intraday low of 1946. The net turnover during the day was Rs. 369270349.

Source : Equity Bulls

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