After 17-Fold Returns In 10 Years, Can Torrent Pharma Continue Its Marathon Run?

Indian pharmaceutical sector has been in the doldrums recently with Nifty Pharma tumbling about 10.7 percent so far in 2019. The sector has been in the news for regulatory and pricing issues.

However, analysts are hopeful that the domestic market will lead them out of woods. A glimpse of that was seen when Torrent Pharmaceuticals announced its earnings for the quarter ended June 2019.

The company on July 23 reported a 32.51 percent rise in its consolidated net profit to Rs 216 crore for Q1FY20, primarily driven by robust growth and margin performance in the domestic market.

Torrent’s Indian business grew 9 percent YoY to Rs 907 crore, while the US revenue stood at Rs 376 crore, up 13 percent from the year-ago period.

The scrip has returned 1,614 percent in the last 10 years, way ahead of peers like Dr Reddy’s Labs (219 percent), Divi’s Labs (467 percent), Sun Pharma(241 percent) and Glenmark Pharma (54 percent). In the same period, Nifty Pharma returned 118 percent.

Experts believe that Torrent Pharma’s blockbuster run is not over just yet. Analysts at various brokerages firms see up to 16 percent upside on the back of strong Indian presence, synergies from the Unichem integration and continued debt reduction. – Money Control

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