Karvy Stock Views on Defensive Healthcare / Pharma - Part II - Aventis Pharma, Unichem Labs, Jubilant Organosys

Aventis Pharma - Target of Rs 1000

Karvy Stock Broking has maintained its buy rating on Aventis Pharma with a target of Rs 1000 in its October 13, 2008 research report. "Net revenues for the quarter are expected to be higher by 8 % to Rs 2.44 billion. Domestic revenues are expected to show 8 % growth for the quarter. Exports are expected to grow by 8 % to Rs 520 million for the quarter and continue the positive trend set in the preceeding quarter. Currently the stock is quoting at 12.2x CY2008E and 11.1x CY 2009E. We believe the company will undergo a rerating process as it delivers better results going forward. We continue to rate the stock as a BUY with a price target of Rs 1,000 based on 14x CY 2009E," says Karvy Stock Broking's research report.

Unichem Labs - Target of Rs 240

Karvy Stock Broking has maintained its buy rating on Unichem Laboratories with a target of Rs 240 in its October 14, 2008 research report. Net revenues for the quarter is expected to grow by 18% to Rs 1,771 million on the back of 15 % growth in domestic formulations business to Rs 1357 million while there has been greater traction in exports with growth of 23 % to Rs 374 million on account of depreciation of the rupee and buoyed by API exports."

"Profits for the quarter are expected to be higher by 43.7% to Rs 305 million. We downgrade our price target by 11 % to Rs 240 based on 8x FY 2010E. We maintain BUY on the stock," says Karvy Stock Broking's research report.

Jubilant Organosys - Target of Rs 300

Karvy Stock Broking has recommended a buy rating on Jubilant Organosys with a target of Rs 300 in its October 13, 2008 research report. "We expect 37% CAGR growth in net revenues from Rs 24.9 billion in FY08 to Rs 46.8 billion in FY10E driven by strong growth from the CRAMS segment coupled steady revenues anticipated from the IPP (Industrial Performance and Products) business. The higher molasses and alcohol prices will remain a concern for the company. The stock is currently quoting at 9.6 x FY 2009E (EPS Rs 21.5) and 8.2 x FY10E (EPS Rs 25.3). On account of compression in valuations we reduce our price target by 21 % to Rs 300 based on 12 x FY 10E, Buy," says Karvy Stock Broking's research report.