IIFL Institutional Equities, a part of the IIFL Group, one of the leading players in the Indian financial services space, recommends “Buy” Torrent Pharma.
According to IIFL report, Torrent reported strong top-line growth for 4QFY12, thanks to a stellar performance in the US and Brazil markets. However, several one-off items impacted operating margins.
IIFL said, “ We expect margins to improve in FY13 led by: no impact of one-offs; weaker rupee; better productivity of newly added sales professionals; and better operating leverage at the Sikkim plant.
The Rs654m exceptional charge is due to a change in accounting policy for sales returns and does not indicate increased weakness or risk in the business. We broadly maintain our estimates and raise our target price to Rs781 from Rs733. BUY, brokerage said.
The report was published by IIFL’s Institutional Equities Research desk.