Gland Pharma shares surge 50% in a month; time to book profit or more upside possible?

Shares of Gland Pharma Ltd have jumped 50.17 per cent in the past one month. The stock today slipped 0.72 per cent to close at Rs 1,659.25, halting their five-day upward run. On a year-to-date (YTD) basis, the scrip has climbed 5.21 per cent. Although, it has declined 29.32 per cent in the past one year. Turnover of the company stood at Rs 13.92 crore, commanding a market capitalisation (m-cap) of Rs 27,327.98 crore.

The generic injectables maker reported a 41 per cent jump in first-quarter (Q1 FY24) revenue, aided by its acquisition of French pharmaceutical group Cenexi. The Hyderabad-based company said revenue jumped to Rs 1,209 crore in Q1 FY24, year-on-year (YoY), from Rs 857 crore.

The company said 37 per cent of the total revenue came from its acquisition of Cenexi in January. Revenue from Europe jumped more than five-fold to Rs 222 crore. If we exclude the Cenexi acquisition, Gland Pharma's revenue rose 3.50 per cent.

Gland Pharma, majority owned by China's Shanghai Fosun Pharmaceutical Group Co, however, reported a 15.30 per cent fall in profit to Rs 194 crore for the quarter ended June 30, 2023.

On technical setup, support on the counter could be seen at Rs 1,500, followed by Rs 1,480, Rs 1,430 and Rs 1,301 levels. One analyst said the counter may rise in the near-term, while two of them suggested booking profits at current levels.

Osho Krishan, Senior Analyst, Technical & Derivative Research at Angel One, said, "The stock recently has gained some traction which recouped some of the lost grounds from the oversold region on the daily charts. At present, it surpassed its major EMAs with robust volumes and sustenance above the same could witness some reversal in the counter. As far as levels are concerned, immediate support is placed around the bullish gap of Rs 1,430-1,301 (coincides with 200-SMA). While on the higher end, immediate resistance zone could be seen around Rs 1,700, followed by the Rs 1,860-1,900 zone in the comparable period."

Vaishali Parekh, Vice-President - Technical Research at Prabhudas Lilladher, said, "The stock has indicated a breakout above the important 200-period daily MA and also above the previous peak zone of Rs 1,480 level to improve the bias. One can expect for a further rise in the coming days. The next near-term target is at around Rs 1,740-1,760 level with support maintained near Rs 1,480-1,500 levels."

Jigar S Patel, Senior Manager - Technical Research Analyst at Anand Rathi Shares and Stock Brokers, said, "After making the bottom near Rs 850-900 levels, Gland Pharma has given a substantial rally of around 88 per cent. Currently, daily MACD is overstretched which is hinting some profit booking. No fresh longs are advised."

AR Ramachandran from Tips2trades said, "Gland Pharma is bullish but also overbought on the daily charts with next resistance at Rs 1,795. Investors should be booking profits at current levels as a daily close below support of Rs 1,430 could lead to Rs 1,036 in the near term."

Meanwhile, Indian equity benchmarks fell sharply today, dragged by bank, financial, consumer, pharma, auto and technology stocks. The 30-share BSE Sensex pack tanked 308 points or 0.47 per cent to close at 65,688; while the broader NSE Nifty index moved 89 points or 0.46 per cent down to settle at 19,543.

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