Karvy Stock Views on Defensive Healthcare / Pharma - Part I - Dishman Pharma, Divis Labs, Wockhardt

Dishman Pharma - Target of Rs 310

Karvy Stock Broking has upgraded its rating on Dishman Pharmaceuticals & Chemicals to buy with a target of Rs 310 in its October 16, 2008 research report. "We expect revenues and earnings to grow at a CAGR of 31.4% and 27% from FY08 to FY10E driven primarily from the high margin CRAMS segment. We maintain our long term positive outlook on the company. Currently the stock is quoting at 12.5x FY 09E and 9.7x FY 10E. On account of contraction in valuations we revise our price target downwards by 18 % to Rs 310 based on P/E of 13.1.x FY10E. On account of price correction we upgrade our rating to BUY with a price target of Rs 310," says Karvy Stock Broking's research report.

Divis Labs - Target of Rs 1415

Karvy Stock Broking has upgraded its rating on Divis Laboratories to buy with a price target of Rs 1415 in its October 16, 2008 research report. "The net revenues of the company set to exhibit 25.7% CAGR growth from FY08 to FY10E on account of continued revenue traction. The earnings are expected to grow at a CAGR of 28.1% from FY08 to FY10E which is estimated at Rs 68.3 in FY09E and Rs 88.4 in FY10E. On account of recent price correction due to fall in markets the company is available at attractive valuations. We upgrade our rating to BUY with a price target of Rs 1415 based on a PE of 16x FY10E basis," says Karvy Stock Broking's research report.

Wockhardt - Target of Rs 200

Karvy Stock Broking has recommended a buy rating on Wockhardt with a target of Rs 200 in its October 15, 2008 research report. "Net revenues are expected to grow by 27% to Rs 9.4 billion. Profits for the quarter are expected to be down by 20 % at Rs 870 million. At fully diluted equity at current price the stock is quoting at 7.7x CY08E and 5.4x CY09E. On a multiple of 7x CY09 the stock would be valued at Rs 200. We rate the stock as a BUY," says Karvy Stock Broking's research report.