Morgan Stanley, CLSA cut Cipla's ratings on earnings

Cite limited niche drug launches, lower margins, slower near-term earninsg growth for the cut

Morgan Stanley and CLSA downgraded their ratings on Cipla Ltd, a day after the Indian drugmaker reported a slower-than-expected rise in its October-December net profit.

Morgan Stanley cut its ratings to "equal-weight" from "overweight", citing slower growth prospects on the back of limited niche drug launches, lower margins and a higher tax rate. The bank also cut its price target to Rs 414 from Rs 437.

CLSA cut its ratings on Cipla to "underperform" from "outperform", citing disappointing margins in the October-December quarter and expectations near-term earnings growth will be slower due a higher base. The bank cut its price target to Rs 415  from Rs 475.