Gland Pharma share price at record high, zooms 177% from IPO price in 8 months; what’s fueling the up move?

Gland Pharma has risen 144 per cent from its all time low levels, hit in November, last year. Image: Reuters

Gland Pharma share price surged over 9 per cent to an all-time high of Rs 4,148.85 apiece on BSE in intraday deals, after the company announced its April-June quarter earnings of FY22. Gland Pharma’s Rs 6,480-crore IPO, India’s biggest pharma public issue, was sold at a price band of Rs 1490-1500 per share. Even as its IPO received a tepid response, the shares saw the listing with a premium of 14 per cent at Rs 1,710 apiece. So far, in little over eight months, this pharma stock has soared 177 per cent from IPO price, while 143 per cent from listing price. Gland Pharma posted a nearly 12 per cent profit growth at Rs 350.7 crore in the first quarter of the current fiscal, on account of robust sales in all markets.

Gland Pharma has risen 144 per cent from its all-time low levels, hit in November, last year. Analysts say that positive sentiment related to pharma stocks has led to a strong uptrend in Gland Pharma. “Technically, the stock is in an overbought zone and investors should use the current rally to exit their buy positions. Fresh buy can be initiated at Rs 3,680-3,700 levels,” AR Ramachandran, Co-founder & Trainer, Tips2Trades, told Financial Express Online.

Gland Pharma reported revenue from operation at Rs 1,153 crore up by 31 per cent as compared to Rs 884.2 crore in the corresponding quarter of the previous fiscal. The company’s core market has reported a 16 per cent on-year revenue growth on strong performance in existing products as well as new product launches. New capacities being made available for the domestic market helped ramp up volume growth in the core portfolio of products. The company also ramped up the supply of essential drugs like Remdesivir and Enoxaparin in anticipation of increased demand from Indian patients during the pandemic’s second wave, said Likhita Chepa, Senior Research Analyst, CapitalVia Global Research. “The company may not witness remarkable sales of Covid-19 treatment-related products in the future. Geographical expansion, new product launches in the rest of the markets and healthy operating leverage are keeping its prospects high,” Chepa told Financial Express Online.

In traded volume terms, 79,000 shares have exchanged hands on BSE, while a total of 14.60 lakh units traded on NSE, so far in the day. “The overall company reported a good set of numbers, we expect the company to continue its export market growth momentum but the Indian market may be flat for the year as all the benefits related to COVID-19 will not be there in upcoming quarters. We have a positive outlook on Gland Pharma,” said Yash Gupta Equity Research Associate, Angel Broking.

(The stock recommendations in this story are by the respective research analysts and brokerage firms. Financial Express Online does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)

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