Accumulate Cipla; target of Rs 1598: KR Choksey

KR Choksey's research report on Cipla

Cipla’s revenue was largely in-line with our estimates. EBITDA beat our estimates due to lower-than-expected operating expenses and Adj. PAT was well above our estimates due to lower-than-expected deprecation, tax expenses, and higher than expected other income. We increase our FY26E/FY27E EPS estimates by 3.5% and 1.7% respectively as we anticipate that workforce expansion in the domestic business will strengthen prescription growth, key launches like Advair (H1FY26E) and Abraxane (H2FY26E) will support North America growth, and the company’s focus on EMEU and SAGA markets, backed by a strong product pipeline, will sustain a robust revenue trajectory.

Outlook

We roll over our valuation multiple to FY27E and assign a PE multiple of 21.0x to arrive at a target price of INR 1,598 (previously: INR 1,680) and maintain an “ACCUMULATE” rating.