Neuland Labs jumps after broker initiates coverage

Neuland Laboratories rose 4.89% to Rs 736.40 at 11:49 IST on BSE after a domestic brokerage initiated coverage on the stock with a 'buy' rating and target price of Rs 1,065.

Meanwhile, the S&P BSE Sensex was down 245.44 points, or 0.73% to 33,440.10.

On the BSE, 15,000 shares were traded in the counter so far compared with average daily volumes of 2,908 shares in the past two weeks. The stock had hit a high of Rs 745 and a low of Rs 710 so far during the day. The stock hit a record high of Rs 1,680 on 5 April 2017. The stock hit a 52-week low of Rs 680 on 7 March 2018.

The brokerage said in a report that Neuland Laboratories is likely to report a strong recovery in the next fiscal. It expects 19% compounded growth rate in revenue and 800 basis point margin expansion and seven times earnings over the fiscal 2018-2020, it added.

Net profit of Neuland Laboratories declined 66.67% to Rs 1.21 crore on 12.46% decline in net sales to Rs 115.93 crore in Q3 December 2017 over Q3 December 2016.

Neuland Laboratories is a leading manufacturer of active pharmaceutical ingredients (APIs) and an end-to-end solution provider for the pharmaceutical industry's chemistry needs.

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