Dr. Reddys (NSE Cash) - Buy
3,180 - 3,150
This one of the outperforming stocks in the
‘Pharmaceutical’ space had undergone a
severe price correction in the month of
This was followed by some consolidation
around the 50% retracement level of the
entire up move from
4386.60. This level coincides with ‘200
EMA’ on weekly chart and thus, can be
considered as a strong support zone.
In addition, a ‘Dragonfly Doji’ pattern
formed on monthly chart is now getting
Considering the positive placement of ‘RSI
- smoothened’ oscillator and ‘PSAR’
indicator on weekly chart, we expect this
stock to give a decent up move in the
Thus,it can be bought from current level to
a decline up to
3150 for a target of
3620 in coming three months. A stop
loss can be placed at
2940 on a closing
Source: Falcon ( Chart time: 14.15 IST )
March 03, 2016
Robust growth in the US, going ahead: After attaining a critical mass
(US$1,113mn in FY2015), DRL aims to scale up its business to the next orbit in
the US market on the back of a strong product pipeline (76 ANDAs are pending
approval, of which, 50 are Para IVs and 18seven are FTFs). The Management
has guided for a robust growth in the US over the medium term, driven by
introduction of new products, some of which are also Para IV opportunities.
On back of the import alert on the three facilities of the company, on worst case
52 week high/low
scenario, we expect the ex-exclusivity US sales to post a CAGR of ~15.7% during
Avg. Daily Volume
Domestic back in focus: The Management expects the company’s performance to
rebound and targets to achieve an above Industry growth rate going ahead,
Face Value (
driven by a) field force expansion and improvement in productivity, b) new
product launches (including biosimilars) and c) focus on brand building.
Outlook: We expect net sales to report a grow at a CAGR of 14.9% CAGR to
19,575 cr and adjusted EPS to record a 17.2% CAGR to
178.8 over FY2015-
Shareholding Pattern (%)
17E. The stock has seen severe beating post the import alert from the USFDA.
On back of considering the attractive valuations, we recommend a Buy rating on
MF / Banks / Indian Fls
FII / NRIs / OCBs
Indian Public / Others
March 03, 2016
Research Team Tel: 022 - 3935 7800
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March 03, 2016