Jubilant Life Sciences receives ANDA approvals for Mycophenolate Mofetil and Rizatriptan; maintain SELL rating with PT of Rs131 :: IndiaNivesh, link

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Mycophenolate Mofetil (250 mg Capsules and 500 mg Tablets) is the g-Cellcept of
Roche, an immunosuppressant which is used to help prevent organ rejection in
transplants. The current annualized US market size as per IMS is US$245 Million.
Rizatriptan Tablets, 5 mg and 10 mg, is the g-Maxalt of Merck, used for the treatment
of migraine. The current annualized US market size for Rizatriptan Tablets 5 mg and
10 mg as per IMS is US$70 Million.
Our View: With ten players already present in US generic market for Mycophenolate
Mofetil, we expect Jubilant Lifesciences (JOL IN) to garner 6-7% market share at 20-
30% discount to current prices. Accordingly, we expect US$8-9mn sales from this
product on annualized basis post commercialization. We expect JOL to launch this
product soon.
With twelve players already present in US generic market for Rizatriptan Tablets,
we expect JOL IN to garner 4-5% market share at 20-30% discount to current prices.
Accordingly, we expect US$6-7mn sales from this product on annualized basis post
commercialization. We expect JOL to launch this product soon. We have already
incorporated the financial impact of these products in our earnings model for FY15E
and FY16E.
Valuation: At CMP of Rs140, the stock is trading at 11.2x FY15E EV/EBITDA and 6.6x
FY16E EV/EBITDA. The stock has been under pressure due to inferior performance
in advance intermediate segment, delay in getting product approvals from USFDA
and gradual pick-up in sales from Spokane facility. The USFDA approval for the two
products mentioned above and the event of overseas listing of Jubilant Pharma
could provide some cushion. However, we maintain SELL rating with price target of
Rs131, based on 6x FY16E EV/EBITDA, as we would like to see sustainable
improvement in business performance before we change our view on the stock

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