The Hindu Business Line : Nicholas: Healthy pill Long-term buy

FRESH investments can be considered in the stock, especially on any declines related to any weakness in broad markets. At the current price of Rs 543, the stock trades at 15 times its trailing four-quarter earnings per share.

Restructuring initiatives over the years, with the latest being the hiving off of Gujarat Glass, have made Nicholas a more focussed pharma entity. Considerable traction is also evident in Nicholas' domestic formulations business, which continues to post above-market growth rates across various therapeutic areas. A strong field force, coupled with new product launches, should sustain the momentum in this space.

Nicholas' acquisition of Global Drugs should provide impetus to exports. Nicholas' policy of respecting intellectual property rights opens up possibilities of collaborating with innovator companies to supply active pharmaceutical ingredients for on-patent molecules. The export initiatives, the strong operational buoyancy in the domestic market, and a sharp decline in debt levels augur well.

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