Cadila Healthcare share price fell almost three percent in trade on August 12, a day after the pharma company reported a 29.33 percent rise in its net profit to Rs 587.2 crore for the June quarter, owing to strong sales in India.

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The company had posted a net profit of Rs 454 crore for the corresponding period of the previous fiscal, Cadila Healthcare said in a regulatory filing. Consolidated total revenue from operations stood at Rs 4,025.4 crore for the quarter under consideration against Rs 3,514.6 crore for the same period a year ago, it added.

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Here’s what brokerages said about Cadila Healthcare’s stock and Q1 performance.

Credit Suisse

The brokerage has maintained an 'underperform' rating on the stock with a target price of Rs 380. The company's current margin reflects the benefit of lower promotion costs in India, according to Credit Suisse. It also said that 30 percent of the market capitalisation is already being attributed to the coronavirus vaccine but the opportunity is shrinking.

Citi

The brokerage has retained a 'sell' rating on the stock with a target price of Rs 490. The company's Q1 performance was driven by the pandemic, but its near-term outlook looks tough unless the vaccine scales up, according to Citi. The underlying trends are not exciting as the company's topline growth was purely led by Covid in the country, the brokerage added.

CLSA

The brokerage has maintained an 'outperform' rating on the stock with a target price of Rs 640. The company appears to be in a consolidation phase before the next leg of growth kicks in, however, its long-term growth story seems intact given its R&D initiatives, according to CLSA.

Motilal Oswal

The brokerage expects 12% earnings CAGR on the back of 16% sales CAGR in DF (considering the muted growth in FY21) and steady US sales (despite increased competition), aided by a 110bp margin expansion from new initiatives in manufacturing, and reduced financial leverage. The vaccine opportunity in India is not built into estimates and can provide a further upside, post-approval. The brokerage maintains 'buy' rating on Cadilla with a target price of Rs 670.

At 12:20, shares of Cadila Healthcare were trading 2.93 percent lower at Rs 547.25 apiece on the BSE.

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First Published:Aug 12, 2021 12:28 PM IST