Cohans Lifesciences and other pharmaceutical shares jump to 5% after Jefferies initiates buy recommendation

Shares of CoHance Lifesciences rose by 5.5% to RS 935 in Intraday trade after Jefferies had initiated cover with a ‘buy’ rating and a target price of RS 1.150. The global brokerage expressed a bullish look at selected Indian pharmaceutical and CRDMO companies, which assign ‘buy’ assessments to CoHance Lifesciences, Divi’s Laboratories and Sai Life Sciences, with an estimated up -up potential of a maximum of 30%.

The news led to an upward rally in the shares, in which CoHance Lifesciences won 5.5%, the Laboratories of Divi that rise 2.5% to an intraday height of RS 6,314.5 and Sai Life Sciences that rise around 2% to RS 943 each on the NSE.

According to Jefferies, India’s CRDMO industry (contract research, development and production organization) is experiencing a major shift, which evolves from traditional chemical production to a strategic partners for global innovators. This transformation is fed by improved possibilities, geographical diversification and the strategic China+1-approach, which, according to the broker, will yield a high-teenage income CAGR over the next ten years.

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Jefferies Top Picks and Target

Sai Life Sciences has been declared top choice of Jefferies in the sector, supported by its integrated service offers, strong East-West-presence and high growth visibility. The company expects a turnover of 15% CAGR and 24% EBITDA CAGR compared to FY25-28E, with a target price of RS 1,100, which represents an advantage of 19% compared to the last closure of RS 924.

CoHance -LifeSciences has been initiated with a buy -rating and a target price of RS 1,150, which implies a benefit of 28% compared to the recent closure of RS 896. Jefferies expects that Cohanance expects the highest growth rate under his CRDMO Cagr for the CRDMO herd, with Ebitda, with ebita, with EBITE -25, Met with Department, Met Met. The company is also seen as the strongest ADC (antibody-medicine conjugate) game in the Indian-stated space, supported by a strong management team and proven execution. Divi’s Laboratories has been upgraded to buy, powered by optimism around its GLP-1 drug frame line, with a target price of RS 7,150, with a 19% of the RS closing price of RS 6.027.Also read: Ola Electric Dowles Rally 5% on policy discussions to accelerate EV -acceptance

The CRDMO sector of India – an income industry of USD 3 billion – has experienced a CAGR of 14% in the last five years. However, the growth has been uneven because of the COVID-related Questions followed by a delay. Looks ahead, Jefferies estimates a high turnover CAGR of 18% between FY25 and FY30E, driven by strong visibility of pipeline, the diversification of Big Pharma through the China+1 strategy and the increasing demand for weight loss and type 2 diabetes medicines).

((Indemnification: Recommendations, suggestions, views and opinions of the experts are their own. These do not represent the views of economic times)