The shares of Biocon dropped nearly 5 percent on November 20 after brokerage Citi double-downgraded the stock to 'Sell' from its earlier ‘Buy rating, citing several reasons. The brokerage has also cut its target price.
Biocon shares dropped to Rs 391.30 apiece on Thursday, extending losses of the second consecutive session.
Citi double-downgrades Biocon shares:
Along with double-downgrading the stock, Citi cut Biocon’s target price to Rs 360 per share from Rs 430 per share. The latest target price implies a downside potential of more than 12 percent from the stock’s previous closing price of Rs 410 apiece.
The brokerage called Biocon’s valuations rich, CNBC-TV18 reported. Notably, the stock currently has a P/E ratio of nearly 90, and the company’s market capitalisation currently stands at Rs 53,077.5 crore.
Citi has lowered its target multiple for the company’s biosimilars business to 14 times EBITDA from 20 times, to price in the worsening market dynamics and changes in the USFDA guidelines. It has also lowered the target multiple of the generics business to 14 times from 16 times to reflect lower margins, the report further said.
While Biocon has strong global presence in terms of biosimilar R&D and execution, pricing pressures and hyper-competitive pipeline may keep sales below expectations, Citi said.
Biocon share price history:
Biocon shares have fallen nearly 5 percent in the past five days, but gained nearly 9 percent in the past one month. The stock is up over 19 percent in the past six months.
Biocon Q2 Results:
Biocon reported a consolidated net profit of Rs 84.5 crore for the July-September quarter of the ongoing financial year 2026. This comes against a net loss of Rs 16 crore reported during the corresponding quarter of the previous financial year.
The firm’s revenue from operations meanwhile rose nearly 20 percent year-on-year (YoY) to Rs 4,295.5 crore in Q2 FY26, from Rs 3,590.4 crore reported in Q2 FY25. Its expenses grew over 18 percent YoY to Rs 4,205.3 crore during the quarter under review.
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