Mr.market doesn’t like uncertainty in earnings. In the case of Natco Pharma it is clearly visible that earnings will definitely fall after 5-6 quarters from now and after that it will take some time to recover back to its growth trajectory. But current liquidity in the market can drive any share up and up and can give company any valuation. Natco Pharma is primarily focused on Para IV and not on the innovation of a new drug. If natco pharma with its high cash balance spends properly on R&D and innovates a new drug then we can see sustainable growth in earnings and higher valuation for the company similar to innovators. But i thing the company is not in the mood of innovation rather copying a drug and doing a para IV filing or inorganic expansion.
Disclaimer: Invested in the company
| Subscribe To Our Free Newsletter |
