Stocks To Buy: Sun Pharma, Lupin, Glenmark Pharma Among DRChokseys Top Ideas In Pharma Sector

Deven Choksey Research Report

Stocks To Buy - Top picks:

Given the strong earnings growth and attractive valuation, we remain positive on Sun Pharma, Lupin, and Glenmark Pharma. The US specialty business, growth potential in Lenalidomide sales, and market leadership in India will support Sun Pharma’s growth.

The respiratory portfolio in Europe, upcoming injectable launches, and the company’s focus on increasing a complex portfolio will boost profitability margins for Lupin.

Branded product portfolio in India and strengthening market position in Europe through the introduction of RYALTRIS are growth drivers for Glenmark Pharma.

In Q2 FY25, companies within our pharma coverage revenue and Ebitda were in-line with our estimates, however adjusted profit after tax underperformed by 4.7%. The Ebitda margin was in-line with our estimate, but adjusted PAT margin underperformed by 73 bps.

The aggregate revenue grew by 10.1% YoY and 1.8% QoQ. The corresponding Ebitda grew by 18.7% YoY but declined by 2.7% QoQ. Ebitda margins expanded by 180 bps YoY (-115 bps QoQ) to 24.9%.

The adjusted PAT grew by 18.4% YoY but declined by 6.4% QoQ. The adjusted PAT margin expanded 114 bps YoY (-141 bps QoQ) to 16.3%.

Zydus Lifesciences, Supriya Lifescience, and Divis Laboratories have reported the highest top-line growth while Laurus Labs and Granules India reported subdued growth.

Nifty Pharma is trading at a 1-year forward PE of 31.4x, slightly above the 1-year average which is reasonable.

Click on the attachment to read the full report:

DISCLAIMER

This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.

Users have no license to copy, modify, or distribute the content without permission of the Original Owner.