Kotak Institutional Equities, a broker, has begun covering Laurus Labs Ltd. and assigned the pharmaceutical stock a “reduce” rating.
The stock’s target price has also been lowered by the brokerage. 350 shares prior to 295 shares.
The pharmaceutical company’s business mix is unlikely to significantly shift toward synthesis in the near future, according to the report.
According to the brokerage, the pharmaceutical company’s “synthesis” segment provides incremental leverage for its valuation and accounts for the majority of its value. While the ARV will remain relevant at 36%, Kotak anticipates that Laurus Labs’ synthesis segment will contribute 32% of its total estimated sales for FY25.
“We expect Synthesis to contribute 32% of total sales in FY 2025E, while ARVs will also contribute 36% of sales in FY 2025E,” according to our viewpoint, “the business mix is unlikely to shift significantly towards Synthesis in the near term.” will keep being important. while our worries largely persist. In the past six months, Laurus stock has lost 43%, unchanged. Since Laurus’ Synthesis segment generates the majority of the company’s value in the CMP, valuations can be reassured in an incremental manner. However, “we maintain REDUCE with a lower FV of Rs 295 (earlier Rs 350)” due to the challenging near-to-medium term outlook, the brokerage stated in its report.
Laurus Labs’ net profit increased by 32.08 percent to 203.04 crore from 153.73 crore in the previous year. Compared to the same time last year, net revenue increased by 50.16 percent to 1,544.82 crore, slightly exceeding expectations.
On Wednesday, the stock of the company gained 2.43 percent at the close. 296.70 on BSE.