Torrent Pharmaceuticals turns ex-bonus today...
About the stock
Incorporated in 1959, Torrent has a strong presence in domestic and semi-regulated markets and a growing presence in regulated markets.
Revenues – India including CRAMs (57%), Brazil (9%), US (13%) and Germany (11%)
Torrent is the eighth largest domestic player and is ranked in the top 10 for CVS, CNS, V&M, GI and anti-diabetes therapies in India
Torrent Pharma turns ex-bonus today
The company made an announcement about bonus shares on May 25, 2022, for issue of bonus equity shares in the proportion of one equity share of Rs 5/- each for every equity share of Rs 5 each
The record date for the bonus issue of 1:1 equity shares is July 11, 2022 while the ex-date for the same is today, July 8, 2022
Consequently, Torrent Pharma’s share price has adjusted to opening price of Rs 1485/share from closing price of Rs 2949/share yesterday
Hence, our target price has also now been revised to Rs 1615/share post this corporate action. However, we change our rating from BUY to HOLD due to the recent run-up in the stock. We value Torrent Pharma at Rs 1615 i.e. 30x FY24E EPS of Rs 53.9
Key triggers for future price performance
In India, Torrent is expanding field strength by ~300 MRs. Also, it forayed into fast growing trade generic segment for acute therapies
Torrent has a good presence in Brazil and expects traction for new launches in branded space while Germany tender business to recover in H2FY23
Awaiting clearance for Dahej and Indrad facility from USFDA. Contribution from manufacturing facility at Levittown, US is expected to start in FY23