India’s best-performing stock is seeing a wave of optimistic calls

According to Bloomberg's Data, Divi's Laboratories Ltd. seeks an estimated 20% gain over the next one year. Expectations are based on the company's expansion plans and ability to win more new businesses as India cuts Chinese suppliers from the market.

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Divi's Laboratories Ltd. share price

Despite Covid19, there are many stocks in the market that are growing rapidly. According to the recently published report, several business tycoons were recently added to the billionaire club and many of them made were added in to the list of top 10 richest person in India. A recent example of Adani Group Chairman Gautam Adani became India’s second richest person in the Covid19 periods.

Similarly, a company Divi’s Laboratories Ltd. , Whose shares are at a high level in the market. Divi’s Labrotaries active pharmaceuticals is one of the top manufacturer of drugs with Jefferies India Pvt. Not only this, there are many other companies whose shares have grown by leaps and bounds in the last 6 months in the time of Covid, companies are Bharat Biotech, Reliance Industry, Adani Group, etc.

According to Bloomberg’s Data, Divi’s Laboratories Ltd. seeks an estimated 20% gain over the next one year. Expectations are based on the company’s expansion plans and ability to win more new businesses as India cuts Chinese suppliers from the market. Therefore, stock analysts expect at least higher gains for the next one year.

“Capital discipline is one of the main hallmark of the company”, said Siddhant Khandekar an analyst at ICICIDirect.com. The company has done a proper utilization of the capitol. The reason for the spending is that the company has tangible orders in hand.

Brockerages raise target of Divi’s Lab:

Brokerage Price target (Rs) Previous target (Rs) Date of change Rating
Jefferies 4,501 3,772 Jan 5 Buy
Axis Capital 4,500 3,800 Jan 8 Buy
Motilal Oswal 4,450 3,900 Jan 8 Buy
ICICIdirect 4,425 4,205 Dec 30 Buy

Source: Bloomberg.

The company’s second quarter earning estimates top in the past year 2020. A construction has started on a new production plant of the company in Kakinada, Andhra Pradesh.

Divi’s stock price has risen about 134 Rupees from an 12-month average estimated price in the past four weeks which is a biggest increase among top 10 companies listed in MSCI India Healthcare Index. According to Data Compiled by Bloomberg, the stock has currently 17, two holds and three sell recommendations.

“The stock can maintain its momentum in this year 2021 as well”, said Tushar Manudhane, an analyst at Motilal Oswal Financial Servies Ltd. in Mumbai.

Note: Therefore, the stock is currently bullish and right time to buy.

Related: Should You Invest in HDFC Mutual Fund?

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