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Cadila Healthcare surges as drug maker gets nod for Covid vaccine ZyCOV-D; what brokerages say

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Analysts are positive on Cadila Healthcare shares after the pharmaceuticals major received emergency use authorisation for its Covid-19 vaccine ZyCoV-D. Among the brokerages positive on the stock are CLSA and Morgan Stanley.

Cadila Healthcare surges as drug maker gets nod for Covid vaccine ZyCOV-D; what brokerages say
Cadila Healthcare shares surged on Monday after the pharmaceuticals major received emergency use authorisation for its Covid-19 vaccine ZyCoV-D. This is the sixth coronavirus vaccine to get approval in India and the first to get approved on a DNA platform.
ZyCoV-D is a three-dose vaccine with an efficacy of more than 66 percent. The vaccine has been approved for children above 12 years of age, making it the first vaccine to be approved for the 12-18 years age group in India.
Cadila Healthcare has said it is looking to manufacture one crore doses by October, and scale its production up to 4-5 crore doses by December-January 2022. There is enough demand to absorb the production, it has said.
Analysts are positive on Cadila Healthcare shares. Among the brokerages positive on the stock are CLSA and Morgan Stanley.
Cadila Healthcare shares jumped as much as 7.67 percent to Rs 576.25 on BSE amid large volumes.
At 9:45 am, the Cadila stock traded with a gain of 4.25 percent at Rs 557.95 apiece on the bourse, outperforming the benchmark S&P BSE Sensex index, which was up 0.60 percent tracking global markets. The stock also sharply outperformed the S&P BSE Healthcare index, which was up 0.57 percent.
By then, 4.04 lakh Cadila shares had already changed hands so far on Monday, as against a daily average of 3.26 lakh recorded in the past two weeks, exchange data showed.
Here's what brokerages say on Cadila Healthcare:
CLSA
The recent correction in the stock offers an attractive entry point, according to CLSA, which has upgraded the stock to 'buy' with a target price of Rs 650.
Multiple long-term drivers should help the company post-double-digit core growth in FY23, according to CLSA.
Morgan Stanley
ZyCoV-D should be a meaningful opportunity for the company as adoption picks up in the ensuing months, said the brokerage.
Morgan Stanley has maintained an 'equal weight' rating on the stock with a target price of Rs 664.
Citi
According to the brokerage, the ZyCoV-D vaccine is included in the target price at Rs 30 per share.
Citi has retained a 'sell' call on the stock with a target price of Rs 490.
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