Biocon: Should You Buy or Sell?

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Biocon: Should You Buy or Sell?
Credit: © Reuters.

By Aditya Raghunath -- Biopharma company Biocon Ltd. (NS: BION ) has seen a very tepid 2021 so far. The stock has fallen 12.18% this year, and has fallen a little over 5.2% in the last 12 months.

Will the stock move up? Brokerages are divided over the future of the stock. CLSA says the stock will fall a lot more. It has a target of Rs 260 on the stock, a potential drop of around 36% from its July 16 closing price of Rs 409. Its primary reasons are:

  1. Negative cash flow for the eighth consecutive year in FY21.
  2. Operating cash flow fell 24% year-on-year. For FY22, it is at Rs 2,220 crore of capex guidance which suggests a high capex intensity for this year as well.
  3. Biologics business margins have fallen which has hurt profitability.
  4. There is no clarity on any listing plans for the biologics business.

While CLSA is negative, PhillipCapital is positive on the stock with a target price of Rs 500. The brokerage revised its rating from “neutral” to “buy” after the United States Food and Drug Administration (US FDA) slapped Amgen (NASDAQ: AMGN ), the pharma company that sells Neulasta in the US with a misbranding complaint. This effectively means that the target market for Biocon’s product, Pegfilgrastim, in this category doubles.

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  • Anju Sharma @Anju Sharma
    It is falling day by day any new comment on this. whole mkt is bullish but this is falling day by day. today it is at 352
    Like 0
  • ram rasool @ram rasool
    sell if you must, buy if you can...
    Like 1
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    Like 1
  • Rakesh Deshmukh @Rakesh Deshmukh
    sustain above 418 then may touch 460
    Like 1
    I am totally disagree with writer. in one line I would ask him if he is given this company will he accept or not? it's as simple as that.
    Like 0
  • Pritish Panja @Pritish Panja
    Biocon start to entering Bullish zone bcause CMP is above 8,13 EMA & 21,55 EMA Goden Crossover done  last day. So Above 400 Bullishness Start
    Like 0
  • paresh gandhi @paresh gandhi
    416 ABOVE BUY  MY ENTRY 398 SL , TGT 450-460
    Like 1
  • Dev Dutt @Dev Dutt
    This guy is should stop writing, honestly bro you gotta find something else to do, you are not good at this at all, i am not holding biocon however i dont see it falling cause its revenue increases every day, the lady makes jhunjhun walla envious on a open investors meet, she is something, shrinking margins aren’t a deal ******** revenue is of the charts, cash flow may be neagtive but thats cause of growth bro, capex is important, basicly i see biocon making new ATH, so you take CLSA on their words, they are like nostradameus :P
    Like 6
  • Ritesh Gupta @Ritesh Gupta
    Biocon has made substantial base and now ready to make new high.
    Like 5

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