With a market cap of Rs 41,960 crore, Abbott India Limited is a major player in the pharmaceutical industry. The company offers various nutritional products, medical devices and diagnostic solutions.

Abbott India Limited is a subsidiary of Abbott’s global pharmaceutical business in India and one of the fastest-growing pharmaceutical companies in the country.

Shares of Abbott India have surged 13.03% in 1 year, and on a year-to-date (YTD) basis, the stock has gained 2.48% in 2022. The stock hit a new 52-week high of Rs 23,934.45 on October 5, 2021, and a 52-week low of Rs 15,514.00 on February 8, 2022.

Currently, the stock is priced at Rs 19,763, close to a 52-week high of 17.42% and 27.38% above its 52-week low.

According to Value Research, the brokerage firm ICICI Securities has issued call options on shares of debt-free company Abbott India. The brokerage set a buy range on the stock at Rs 19,200-19,750 with a stop loss of Rs 17,630 and a target price of Rs 21,900. ICICI Securities maintains a 3-month target frame for the stock to reach its target price.

The brokerage said in a note, “Pharma stocks have fallen sharply over the past ten months and have gone unnoticed. The pharma sector has shown resilience over the past few months, indicating the emergence of relative strength and providing favourable conditions. Risk-reward setup. Among multinational pharmaceutical companies, Abbot India is our top pick as the stock has been resilient in the recent market correction and is about to break out of the range of the past six months (Rs 19,600-15,520), suggesting a resumption of gains and provides a new opportunity for entry.”

ICICI Securities said, “Buying demand for the stock is seen at the 15500-16000 support area as it is the rising demand line with the 20-year (Rs 12,186), 21-year (Rs 13,960) lows and the 100-week EMA rising (Currently at Rs 16,883). Historically, the 100-week EMA has only been tested twice in CY13 and CY17 in the past decade. In both cases, it has provided decent returns in subsequent quarters. We expect the stock to maintain a positive bias and head towards the Rs 21,900 level in the next few months as it is the 80% retracement of the entire decline (23,934-15,514).”

“Abbott has been consistent with brand-driven growth driven by favourable market dynamics, physician prescribing stickiness and low perceived risk factors. The company remains focused on new product launches, which is fairly consistent (100 new product launches and product lines over the past ten years) Expansion. For Abbott’s estimated NLEM portfolio exposure of ~21%, ~10.8% increase in NLEM prices could also have a positive impact) on price-led growth in FY23. FY17-22 revenue compounded 11.1% over the past five years’ Annual growth rate growth. Meanwhile, the EBITDA margin improved from 13.7% in FY17 to 22.1% in FY22. We expect Abbott to grow at a CAGR of 12% in FY22-24 and further improve its margin to 23.8%,” the brokerage said.