Accumulate Indoco Remedies; target of Rs 380: Prabhudas Lilladher

Prabhudas Lilladher recommended accumulate rating on Indoco Remedies with a target price of Rs 380 in its research report dated January 24, 2024.

Broker Research

January 24, 2024 / 14:36 IST

Accumulate

26 Aug, 2025 12:21

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Prabhudas Lilladher's research report on Indoco Remedies

We cut our FY25/FY26 EPS by ~10%/4% to factor in low margins and lower sales across regulated markets. We downgrade stock from Buy to Accumulate given weak earnings visibility, muted domestic formulation sales. Our numbers do factor in margin recovery with reduction in remediation cost from FY25. Indoco Remedies’ (INDR) Q3FY24 EBITDA was sharply below our estimates led by continued higher remediation cost and lower regulated market sales. The recent OAI to its Goa unit-2 is negative and will restrict growth in US sales in FY24/H1FY25. We expect 18% PAT CAGR over FY23-26E.

Outlook

At CMP, stock is trading at 20.5x FY25E EPS. We downgrade stock to Accumulate from Buy with revised TP of Rs380 valuing at 18x Dec 2025E EPS, as we roll forward. Timely resolution of Goa facility unit-2 is a key for re-rating.

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