Buy Piramal Pharma; target of Rs 240: Motilal Oswal

Motilal Oswal's research report on Piramal Pharma

Piramal Pharma (PIRPHARM) delivered in-line revenue for 2QFY62. However, it delivered a miss on EBITDA/PAT for the quarter. Higher operational costs impacted the quarter’s performance. While CDMO sales growth was impacted by the high base of the past year (a large contract from a customer in FY25), PIRPHARM is witnessing health improvement in biotech funding, driving order inflows.

Outlook

We value PIRPHARM on an SoTP basis (18x EV/EBITDA for CDMO business, 12x EV/EBITDA for CHG business, and 13x EV/EBITDA for ICH business) to arrive at a TP of INR240.