Cipla Q4 below street estimates: Know what brokerage firms have to say – check target price here

Amid the fourth quarter results being sharply below estimates, the brokerage firms post mixed sentiments towards the pharma major Cipla. However, the company reported a 68 per cent jump in the consolidated net profit in the March-ended quarter of the financial year 2020-2021. 

Goldman Sachs maintains a Neutral call on Cipla after co misses its estimates in the fourth quarter, led by a 200 bps gross maintain impact. The brokerage firm says seasonal weakness pronounced in the absence of flu season in both India and key markets. It downgraded the target to Rs 890 per share. 

The consolidated revenue of Cipla grew by 5.3 per cent year-on-year to Rs 4,606.4 crore in Q4FY21, with North American business showing a 17 per cent YoY growth and India business 4 per cent growth. 

Similarly, JP Morgan has also given a Neutral call on Cipla as US business and margin disappoint. The brokerage firm states, the management guided to maintaining or improving upon the FY21 margin of 22 per cent. JP Morgan downgraded the target to Rs 785 per share. 

Cipla in its BSE filing said, “In India, the prescription business grew by 6 percent YoY and the sequential normalisation is in line with expectations. Expanded COVID portfolio is expected to see traction along with core respiratory products.” 

On other hand, Morgan Stanley has an Overweight call on Cipla with a target of Rs 949 per share. It points out the company continues to strengthen its base business in India, the US, and South Africa. The brokerage firm also says, US inhaler pipeline is looking deep with several late-stage products. 

The company’s board on Friday approved a final dividend of Rs. 5 per share for the financial year ended March. 

Cipla slumped by over two and a half per cent on BSE to Rs 881 per share at around 01:15 pm. On Friday, the stock had closed at Rs 904 per share.