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Centrum Broking
Pfizer (Buy)
CMP: ₹1,217.30
Target: ₹1,670
We maintain ‘Buy’ rating on Pfizer with a revised price target of ₹1,670 due to positive developments regarding the merger. The brand portfolios of Pfizer and Wyeth are complementary and there is no overlap. Key major brands of both companies grew 14.9 per cent compound annual growth rate during FY08-FY13 despite the slowdown in domestic market due to National Pharmaceutical Pricing Policy. Both the companies reported improved performance in February 2014 after passing a bad phase involving NPPP and trade related issues. Key risks to our estimates are slowdown in the domestic pharma market and delay in merger with Wyeth.
Motilal Oswal
HUL (Sell)
CMP: ₹598.55
Target: ₹565
Weak macros (low GDP growth, high inflation and weak consumer sentiment) are taking a toll on broader consumer spends, as disposable incomes have remained flattish. HUL, being the barometer of Consumer spends in India, is reflecting the same. Despite recent underperformance, valuations remain rich at 32.8x FY15E EPS. Reversal in volume growth trends is a key risk.
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