Research

ICICI Direct on Cipla: Consolidation breakout signifies resumption of primary up trend...

Posted On : 2022-03-13 10:43:27( TIMEZONE : IST )

Technical View:

The Pharma index is on the cusp of resolving out of eight month's consolidation. Within pharma space, Cipla has relatively outperformed and formed a higher base above 52 week's EMA. With today's swift up move stock resolved out of 11 month's consolidation (Rs. 1005-850) and clocked a fresh all-time high of Rs. 1030, indicating rejuvenation of upward momentum. Hence, it offers a fresh entry opportunity
On the oscillator front, weekly MACD logged a bullish crossover after forming a higher base above zero line that corroborates our positive bias

Fundamental View:

Cipla is a global pharma company with strategy of targeting four verticals viz. One-India, South Africa & EMs, US generics & specialty and lung leadership. Indian branded formulations business accounts for ~40% of revenues while Cipla derives 21% of its export revenues from the US followed by 12% from South Africa, 5% from Europe and 16% from RoW markets
The company is focusing on front-end model, especially for the US along with across the board transformation from tenderised model to private model in exports market and more focus towards consumerisation of important TGx, Rx products in Indian branded formulations
Going forward, significant momentum in Cipla is likely due to 1) US gains on back of peptide portfolio unlocking and possible approvals and launches of gRevlimid, gAdvair and gAbraxane besides gains from Albuterol portfolio and 2) Robust domestic business amid strong respiratory franchise

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Link to the report

Shares of Cipla Limited was last trading in BSE at Rs. 1044.40 as compared to the previous close of Rs. 986.80. The total number of shares traded during the day was 295822 in over 10348 trades.

The stock hit an intraday high of Rs. 1053.35 and intraday low of 982.15. The net turnover during the day was Rs. 303295333.00.