Buy Lupin; target of Rs 2400: Prabhudas Lilladher

Prabhudas Lilladher's research report on Lupin

Lupin’s (LPC) Q1FY26 EBITDA stood at Rs16.4bn (up 28% YoY) was in line with our estimates on the back of higher US sales supported by niche launches (gTolvaptan). LPC saw remarkable turnaround in profitability with ~2x jump in EBITDA over FY23-24 aided by better product mix, continued niche launches in the US, clearance from USFDA for facilities, domestic formulations regaining momentum and cost optimization measures. We expect margins to sustain given a strong pipeline in the US. Our FY26E and FY27E broadly remain unchanged.

Outlook

We maintain BUY rating with TP of Rs2,400 (25x FY27E EPS). Any competition in gSpiriva and delay in new launches in the US will be key risks to our estimates.