Accumulate Zydus Lifesciences target of Rs 1050: Prabhudas Lilladher

Prabhudas Lilladher recommended accumulate rating on Zydus Lifesciences with a target price of Rs 1050 in its research report dated November 13, 2024.

Broker Research

November 13, 2024 / 12:27 IST

Accumulate

26 Aug, 2025 12:21

Volume

Todays L/H

Prabhudas Lilladher's research report on Zydus Lifesciences

Zydus Lifesciences (ZYDUSLIF) Q2 EBITDA of Rs14.2bn (up 33% YoY) was in line with our estimate. The stock price has corrected by ~25% over last 3 months on account of concerns of high product concentration risk, incremental competition in gAsacol and litigation delay news flow on gCabometyx. We believe the company’s steady domestic franchise, strong balance sheet and potential new launches in the US will help negate pricing pressure and likely competition in some key products like gAsacol. Moreover, ZYDUSLIF is working on a robust pipeline of complex products, including injectables, oncology, transdermals, NCE, biosimilars and vaccines, which are expected to materialize over the next 2–3 years. Mgmt have guided for 2-3 high value launches over F27/28, which will keep momentum in US sales healthy.

Outlook

Our FY26/27E EPS stands cut by ~10% as we factor in lower US sales, margins and higher tax. We maintain our ‘Accumulate’ rating with revised TP of Rs1,050, valuing at 25x FY27E EPS.

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