- Cipla shares rose over 4% after Citi maintained a bullish outlook with a buy call
- Citi set a target price of Rs 1,700, implying a 265% upside from current levels
- Citi initiated a 90-day positive catalyst watch citing US market approvals and launches
Shares of Cipla Ltd. gained over 4% on Monday, June 22, after global brokerage Citi maintained a bullish stance on the pharmaceutical major, initiating a 90-day positive catalyst watch. Citi sustained its 'buy' call on the stock and pegged a target price of Rs 1,700, representing a 265 upside from the current levels. Domestic benchmark indices resumed gains after a blip on Friday. The NSE Nifty 50 benchmark traded above the 24,100-mark, while the BSE Sensex rose 400 points in noon trade.
Cipla share price opened at Rs 1,372 against a previous close of Rs 1,351.80 and extended gains by over 4% to hit an intraday high of Rs 1,409 apiece so far on the NSE. Shares last traded 4.06% higher at Rs 1,406 apiece on the NSE. This compares to a 0.45% rise to 24,124.60 in the Nifty 50 index. The stock is up 2% in a week but has declined 6.32% on a year-to-date basis and 6.25% in the last one year. The pharma major commands a market cap of Rs 1,13,817.3 crore.
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Cipla Share Price Intraday
Citi bullish on Cipla: Here's why
Citi initiated a 90-day positive catalyst watch on Cipla over the near-term US triggers such as Flovent approval, gVentolin launch and a strong 50% share in Nintedanib. These should support a rebound in US revenues for the pharma giant. India business is tracking well, aided by a recovery in the respiratory segment. Indore plant re-inspection, due anytime, could provide an additional catalyst upon USFDA clearance, according to the brokerage.
Citi also believes that the easing geopolitical pressures further reduce risks around input costs and margins for the company. Earnings are likely having bottomed post the gRevlimid decline, according to Citi. The risk-reward looks attractive and Cipla also offers a strong domestic proxy amid elevated valuations of India among heavy peers, as per the brokerage.
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