One Pharma Stock to Watch (Techno-Funda Analysis): Biocon Ltd.
BUY with a target of 720-810.
- Biocon with its strong presence is backed by continuous strong traction under its growth segments (Biologics and Syngene).
- Promising growth from Small molecules segment and Strong growth in biologics will improve overall margins.
- Progress on the biosimilars regulatory front in developed markets and launches in the developed as well as emerging markets are likely to be key levers for the company.
- The key developments during the quarter were approval of Fulphila (Pegfilgrastim) Biosimilar co-developed by Biocon and Mylan for launch in the US markets.
Technical Analysis: Monthly chart
On a monthly technical chart, Biocon has remained on an uptrend. In the year 2018, the scrip touched a new all-time high at the levels of 718 in the month of September 2018. Looking at the price charts, the scrip began the year 2019 on a positive note and touched the high of 682 and closed the month of January at the levels of 648.30. Overall a bullish trend is well seen on the charts.
Looking at the major indicators, such as, RSI at the levels of 66.28 with a slight positive divergence on the charts, ADX at the levels of 59.29 with -DI line below the +DI line, and MACD in the positive territory indicates the upside move to continue for the short term.
On a weekly chart with weekly candles, the scrip is trading in a range. In the year 2019, the scrip started the year on a positive note and made a higher high price move, which is well-indicated on the price chart. The month of January ended the week with the formation of a long legged doji, indicating the rejection to any downside move.
Major indicators, such as, RSI at the levels 54.79 with a slight weakness indicates dips to be taken as good entry points to be included in the portfolio. ADX at the levels of 13.09 with +DI line above the signal line and the -DI line indicates an upside move, and MACD in the positive territory indicates a positive move.
First published on 05 February 2019.