Gland Pharma jumps 7% intraday despite weak Q3 performance; brokerage sees 26% upside
The buying sentiment in stock can mainly be attributed to improved gross and net margins sequentially in the December quarter despite weak revenue, as per YES Securities.
Despite weak Q3 earnings, Gland Pharma shares are among the top gainers on the exchanges today. The stock touched a day’s high level of Rs 1452.8 per share, after surging for more than 7 per cent on the BSE during Wednesday’s session. It, however, surrendered the gains tacking weak sentiment in the domestic market to trade in negative bias around 3 PM.
The buying sentiment in stock can mainly be attributed to improved gross and net margins sequentially in the December quarter despite weak revenue, as per YES Securities.
The mid-cap pharma company reported a weak quarter on declining US revenues year-on-year (YoY) as lack of customer offtake, still lingering supply concern and company opting margin over market share led to revenue shortfall, YES Securities lead analyst Bhavesh Gandhi said in a report.
Image Source: Stockedge
The brokerage expects another lackluster quarter in Q4 with traction in the US being back-ended in FY24 and the cut the target price to Rs 1,720 per share (26% upside) from Rs 3,060 per share earlier, given the lack of near-term triggers.
The brokerage tagged Buy rating on the stock mainly on the strong commentary from management. “FY24 should see growth coming back and believe the current environment is a temporary situation and not looking at refashioning of business model,” the management said.
Gland Pharma: Mutual Funds’ Favourite
The Mutual Fund houses have increased their holdings in Gland Pharma from 18.48 per cent to 19.49 per cent in December 2022 quarter. More than half a dozen MF firms have stakes in the company. Kotak MF, Aditya Birla Sun Life MF, UTI, Nippon Life, Axis Mutual Fund, ICICI Prudential and Mirae Asset Management have up to 4 per cent holding in the stock.
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03:12 PM IST