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MOSL: Morning India (10/September/18): 1. Axis Bank; 2.Sun Pharma; 3. NCLT & Insolvency Day; 4. Lupin – (ART); 5. EcoScope; 6. Economy (Monsoon)

MOrning India (10/September/18): 1. Axis Bank; 2.Sun Pharma; 3. NCLT & Insolvency Day; 4. Lupin – (ART); 5. EcoScope; 6. Economy (Monsoon)

 

Today’s top research idea

Sun Pharma: Recent Halol 483 - Not a show stopper

• US FDA recently conducted an inspection at SUNP's Halol plant from 27-31 August and issued Form-483 with six observations. We believe the observations are resolvable and should not impact existing business and/or new approvals, pertaining to SUNP.
• We raise EPS estimate by 1%/3% for FY19/FY20 to factor in the favorable currency movement. We expect a premium for SUNP to further expand from 25% to 35%, compared to an industry average of 20x 12M forward earnings on the back of increasing share of specialty portfolio. SUNP is the only Indian-listed entity, which is progressing well in the specialty portfolio.
• We believe, the incremental generics business from new launches, which should be higher than base business erosion, increased traction in specialty products and sustained outperformance in the domestic formulation business should drive growth. Accordingly, we revise our target price to INR790 (from INR700 earlier).

Piping hot news

Sebi panel eases deal for FPIs, allows NRIs to hold 25% in offshore funds

A Securities and Exchange Board of India (Sebi)-appointed experts group on Saturday made a slew of recommendations which are likely to soothe the nerve of foreign portfolio investors (FPIs). The HR Khan-led committee on easing access norms for overseas investors has recommended significant relaxations to the controversial April 10 circular issued by the capital markets regulator.