Buy Glenmark Pharma; target of Rs 1403: KR Choksey

KR Choksey's research report on Glenmark Pharma

EBITDA beat our estimate due to improved products and geographical mix. The stock is trading at 24.9x/19.4x based on FY25E/FY26E EPS respectively. We maintain valuation multiple at 23.5x on FY26E EPS to arrive at a TP of INR 1,403/share (previously: INR 1,266); maintain BUY rating on the stock. We believe India segment has a strong growth trajectory as the Company has been able to outperform in key therapies such as respiratory, derma and cardiac and the IPM share is expected to continue to rise. The EU and RoW segments are likely to continue to contribute to growth as well with increase in Ryaltris’ market share and launch of new products including Envafolimab and Winlevi in FY26E and ahead.

Outlook

Currently, the stock is trading at 24.9x/19.4x based on FY25E/FY26E EPS respectively. We expect the revenue to grow at 10.0% CAGR and Adj. PAT to grow at 41.4% CAGR over FY23-FY26E. We increase the target price to INR 1,403/share (previously: INR 1,266) and maintain our BUY rating on the stock, implying a FY26E PE multiple of 23.5x. The stock has upside potential of 20.9% from the CMP.

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