Fundamental

Suven Life Science



Company Overview

SVLS (Suven Life Sciences) is a clinical-stage Biopharmaceuticals company, which manufactures and supplies drug intermediates and speciality chemicals to global innovator companies. It provides Contract Research & Manufacturing Services (CRAMS), including development and supply of pharmaceuticals for New Chemical Entities (NCEs). In addition, it also undertakes proprietary research on NCEs for CNS disorders. SLS’ expertise lies in Process Research, 

Custom Synthesis and NCE Development Support Services. Currently, in the NCE space, 13 molecules are at various stages of development.

Outlook& Valuation

Considering the 16% adjusted PAT CAGR over FY18-20E with upward potential, strong balance sheet, improving return ratios and good corporate governance practices, we are optimistic about the long-term growth prospect of the company. At the CMP of Rs 270, the stock is trading at 24.5x its FY19E EPS of Rs 11 and 20x its FY20E EPS of Rs 13. We recommend ‘Buy’ rating with target price of Rs 325 per share. Our target price is based on 25x FY20E EPS which gives a potential upside of 16%.


Tags: Fundamental PickSuven Life Science


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