Business News

Expecting a further pickup in Emcure Pharmaceuticals’ organic growth in 2HFY25, domestic brokerage firm Kotak Institutional Equities upgraded the stock’s rating to ‘buy’ from an ‘add’ earlier, with a target price of Rs 1,680.This signals an upside potential of 28% from Monday’s stock closing price.“After a decent 1HFY25 print, we expect a further pick-up in Emcure’s organic growth in 2HFY25, with upbeat prospects across India, Canada and ROW. Compared to 6% yoy in 1HFY25, we estimate 9% yoy overall organic growth in 2HFY25E,” said Kotak in its report.Led by healthy organic growth, an in-licencing deal with Sanofi, consolidation of Mantra and with most of the legal challenges behind, Emcure is expected to report a 13% overall sales CAGR over FY2024-27E. On a low base, improved productivity post the 20%+ field force addition since FY2022 is expected and higher utilisation of the new facilities is likely to drive robust 18%/29% EBITDA/EPS CAGRs, over FY2024-27E.On the international front, it is expected that Emcure’s organic business in Canada will report a strong 16% YoY growth in 2HFY25. Moreover, aided by the Mantra deal (consolidated from Nov 2023), the domestic brokerage firm forecasts a robust 19% Canada sales CAGR, over FY2024-27E.Also, a pick-up in ARV sales is expected, with strong traction for Tenecteplase to drive an 11% ROW sales CAGR, over FY2024-27E.Emcure is one of the few major Indian pharma players with no meaningful direct US generics exposure, thereby lending greater earnings stability.Also read: Vodafone Idea shares zoom 18% on in-principle Cabinet nod for bank guarantee waiverLed by its R&D prowess, Emcure has built a complex portfolio (40% of sales), comprising chiral molecules, iron compounds and biologics. It is a leading player in gynaecology and has also scaled up brands across multiple therapies, such as cardiac, VMN, anti-infectives and antivirals, leading to one of the highest prescription coverages (71%) among specialists in the IPM.A renewed focus is likely to drive robust 13%/18%/29% overall sales/EBITDA/EPS CAGRs, over FY2024-27E.However, further repercussions due to the drug price-fixing cases in the US/Canada, further litigations such as the now-resolved one with HDT Biocorp and the inability to consistently outperform IPM growth are the key risks stated by Kotak Equities.The shares of Emcure Pharma were trading 5.6% higher at Rs 1,384.75 on the BSE around 12 noon on Tuesday.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

C2C Advanced Systems, which launched one of the biggest SME IPOs this year, has deferred its listing following intervention from market regulator Sebi. The company has also given investors an option to withdraw the application from this IPO."Based on intimation received from Sebi, all investors, other than anchor investors, will have an option to withdraw their bids for ongoing SME IPO of C2C Advanced Systems from November 26 up to November 28 for all categories," C2C Advanced Systems said in a notice.The withdrawal window for QIB and NII categories will remain open till 4:00 pm and the retail portion up to 5:00 pm on November 26. Withdrawal windows for all categories will be allowed on November 27 and November 28 between 10:00 am and 5:00 pm.Also Read: When and how investors can withdraw bids in C2C Advanced Systems IPO? Here's a guideThe IPO of C2C Advanced Systems received a strong response from investors before the intervention from Sebi as the issue was subscribed nearly 96 times so far. The issue, priced at Rs 214-226 per unit, will close for subscription on Tuesday.According to reports, Sebi has asked C2C Advanced Systems to appoint independent auditors and get an independent report of financial accounts.According to the revised schedule, the IPO listing is postponed by 2 to 3 days and the same will be on or before December 3. The company is likely to finalise the share allotment on or before November 29.Further, the NSE will have a monitoring agency set up on the usage of funds post-listing.This is the second time an SME IPO has come under scrutiny from the regulators and postponed its listing. Earlier this year, Sebi had asked BSE not to proceed with the listing of Trafiksol ITS Technologies amid serious concerns over misuse of the funds received from the IPO.C2C Advanced Systems specialises in the development of complex systems for defence, homeland security and aerospace sectors. It also delivers bespoke, cutting-edge solutions to all the arms of the defence forces involving the integration of complex weapons and sensors.Also Read: Enviro Infra Engineers IPO: GMP, Price Band, Subscription, Key Dates, ReviewThe company also offers command and control systems for industrial platforms, focusing on supply chain and logistics virtualisation. Its expertise includes system integration, system architecture, software development and testing, which involved delivering a combat management system to the Royal Malaysian Navy.In FY24, the company achieved a revenue of Rs 41 crore, EBITDA of Rs 18 crore, and a PAT of Rs 12 crore.