Oncology and OC (oral contraceptive) products having limited competition in the US, coupled with high growth in the domestic and LatAm markets should drive Glenmark's earnings going forward. The company would also benefit from its Para IV launches of Tarka and Zetia over FY12E. The Sanofi deal for GBR500 and GRC15300 will strengthen Glenmark's out-licensing capabilities. 

We value Glenmark's core business at 15x FY13E earnings (25% premium to its global peer group multiple) to arrive at a value of INR344. We assign INR33/share for the limited competition opportunities (Cutivate, Malarone, Lamisil etc) at probability adjusted NPV and INR7/share for the GBR500 deal with Sanofi. Thus, our target price works out to INR385, implying potential upside of 22% from the current level.

1 of 1 File(s)