(New throughout, adds share detail)

July 17 (Reuters) - Citigroup started its coverage of Genentech Inc DNA.N on Thursday with a "buy" rating and a $91 price target, due to its strong sales growth outlook for the biotechnology company's top drug Avastin.

Citigroup forecast 17 percent compounded annual growth for Avastin sales in the 2008 to 2012 period, driven by growth in colon, lung and breast cancer.

For the entire company, the brokerage forecast 15 percent sales growth for the same period, ourstripping the 12 percent projected for the entire biotechnology group.

On Monday, Genentech reported 15 percent higher second-quarter sales for Avastin. Genentech is also studying the drug in treating brain cancer and kidney cancer, and as a treatment for patients who have had their tumors surgically removed.

Shares of Genentech closed at $78.77 Wednesday on the New York Stock Exchange. (Reporting by Varsha Tickoo in Bangalore; Editing by Anil D'Silva)