Author: root

Torrent Pharma

Sharekhan is bullish on the stock of Torrent Pharma and has suggested buying the stock with a price target of Rs 3,400, against the current market price of Rs 3,100. According to the broking firm, a higher share from the chronics and sub-chronic segments bodes well for growth of the domestic business. Market share gains (by growing at a higher pace as compared to the industry), therapy consolidation, therapy expansion, and sustained investment in new products would be the key driving factors, it has said.

“Therapy and product portfolio and plans to increase coverage in key markets such as German will help. Torrent sees US sales bottoming out and expects a gradual improvement, driven by planned launches from Levittown plant and already approved products. USFDA Resolution of the Indrad and Dahej plants is awaited and its clearance could lead to earnings upgrades. At the current market price, the stock is trading at 36.4x/28.9x its FY2022E/FY2023E EPS. We have also introduced FY2024 estimates in this note. Based on encouraging outlook for US business and strategy for sustainable growth, we maintain our Buy recommendation with a revised target price of Rs. 3,400,” the brokerage has said.

L&T Technology Services

Sharekhan has maintained a “buy” on the shares of L&T Technology Services with a price target of Rs 3,400 on the stock.

“We have revised our earnings estimates upward for FY2022E/FY2023E/FY2024E because of strong all round performance in Q1FY2022, rise in revenue growth guidance and anticipation of stable margins. The management indicated strong demand environment across the segments.

As one of the largest pure play ERD players in India, we believe that L&T Technology Services is well-placed to benefit from the acceleration in digital engineering spends given its multi-domain expertise, full-service model and leadership depth.

We expect L&T Technology Services’ USD revenue and earnings to grow at a CAGR of 17% and 25% over FY2021-24E. At the current market price, the stock is currently trading at 27x/24x FY2022E/ FY2023E earnings estimates, which justifies premium valuation, given consistent deal wins, strong deal pipeline and robust demand environment. Given its presence in fast-growing ERD segment, we retain a Buy rating on L&T Technology Services with a revised target price of Rs. 3,400,” the broking firm has said.

Infosys

Sharekhan has said that though revenue growth was robust, EBIT margin lagged its own estimates as far as IT major Infosys was concerned. “We maintain a Buy on Infosys with a revised target price of Rs 1,820 given strong outperformance in revenue growth versus large peers, a robust deal pipeline and strong demand,” the broking firm has said.

Infosys saw good growth in revenues with constant currency revenue growth rising by 16.9% YoY and 4.8% QoQ. The company reported revenues at $3,782 million, which was a growth of 21.2% YoY. Digital revenues at 53.9% of total revenues, YoY CC was up 42.1%. Operating margins at 23.7%, saw an increase of 1.0% YoY and decline of 0.8% QoQ.

“Our clients continue to be supportive of the multiple initiatives we have undertaken; they value the delivery commitments we have met even during these extraordinary times”, said Pravin Rao, Chief Operating Officer, Infosys. “As the demand for digital talent explodes, rising attrition in the industry poses a near-term challenge. We plan to meet this demand by expanding our hiring program of college graduates for FY 22 to 35,000 globally”, he added.

Disclaimer

Stock market investment is subject to risk associated with the stock markets and hence investors need to be very careful. Neither the author, nor the brokerage, nor Greynium Information Technologies Pvt Ltd would be responsible for losses incurred based on a decision to buy into the stocks based on the above article. Stock indices are currently at lifetime highs and hence investors needs to be cautious.

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