We note that Piramal has strategically adopted a cautious stance in the uncertain economic environment, by shifting its focus from pursuing aggressive growth to consolidation and conservation. Despite the fact that the next few quarters are expected to remain challenging for the company, we remain confident of Piramal�s ability to stride through the tough times. With strong global relationships, world-class infrastructure and proven capabilities in research, Piramal is one of the best plays in the contract research and manufacturing segment.”
“Further, with a strong foothold in the domestic market, which accounts for 50% of the company�s business and almost 60% of its profits, Piramal offers stable growth prospects in the medium to long term. At the current market price of Rs 178, Piramal is discounting its FY2009E adjusted earnings by 8.5x and its FY2010E earnings by 7.5x. We maintain our ‘Buy’ recommendation on the stock with a price target of Rs 358 (15x FY2010 earnings),” says Sharekhan’s research report
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