Angel Broking has recommended buy rating on Wockhardt with a target of Rs 630 in its February 21, 2008 report. “Wockhardt posted consolidated Sales and Profits of Rs 762 crore and Rs 106 crore in 4QCY2007 registering a growth of 45% and 21%, respectively. With this, for CY2007, Wockhardt posted consolidated Sales and Profits of Rs 2653 crore and Rs 386 crore registering a growth of 53.4% and 59.8%, respectively. A combination of the company’s organic and in-organic initiatives was mainly responsible for the growth in CY2007. During CY2007, the European business clocked an impressive growth of 97% to Rs 1410 crore (Rs 715 crore). Apart from Europe, US also posted robust growth of 64%.”
“At the CMP, the stock is trading at 8.5x CY2008E and 7.4x CY2009E FDEPS, which is at a significant discount to its peers. A substantial part of the discount is on account of the high competitive pressures in the Generic space and dependence of the company on its M&A strategy to scale up its Generic business. The stock is quoting at 4.5x EV/EBDITA CY2009E, which is at a significant discount to its peers, which are trading at 6.5x EV/EBDITA. We believe the stock is available at attractive valuations even after discounting the concerns. Hence, we maintain a Buy on the stock, with an 18-month Target Price of Rs 630," according to Angel Broking research report.