Buy Ajanta Pharma; target of Rs 3200: Prabhudas Lilladher

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Prabhudas Lilladher's research report on Ajanta Pharma

We initiate coverage on AJP with ‘BUY’ rating and TP of Rs3,200/share, 25% upside from current levels. AJP’s play on high growth branded generics (BGx) market spread across India, Asia and Africa contributed 74% to total revenue in FY25 and delivered 12.5% CAGR over FY22-25. We expect AJP to clock 13% revenue CAGR over FY25-28E driven by increased focus on branded formulations, penetration into newer therapies and scaleup in US generics. Overall, we expect EBITDA/PAT CAGR of 17%/ 16% over FY25-28E with healthy RoE/RoCE of 28.5%/35.6% in FY27E.

Outlook

At CMP, AJP is trading at 24x P/E and 17x EV/EBITDA as of Sep FY27E. We value AJP at 30x P/E on Sep FY27E EPS based on its ability to generate higher RoE/RoCE compared to peers and strong exposure to BGx markets. Initiate with ‘BUY.

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Ajanta Pharma - 22 - 09 - 2025 - prabhu