Emkay Global Financial has issued a buy rating on Granules India with a target price of ₹800 in its research report dated March 31, 2026. According to the broker's analysis, the recommendation is based on a sum-of-the-parts (SOTP) valuation methodology, implying a target EV/EBITDA multiple of approximately 12x. The brokerage expects the stock to deliver around 30% upside potential from current levels.
The broker highlighted Granules India's margin resilience over the last 6 quarters despite challenges at its flagship Gagillapur facility due to regulatory escalation. As reported by Emkay Global, the company's strong performance in the US controlled substance market has created a virtuous cycle where fulfilling quotas in one year leads to higher quotas in subsequent years. The brokerage expects controlled substances to account for close to 30% of FY26E consolidated sales, positioning them as a key multi-year growth driver with expected portfolio additions starting FY28.
According to Emkay Global's analysis, Granules India is undergoing a transition on three fronts: API/PFI to FDF, B2B to B2C, and legacy to complex generics, all of which are margin-accretive transformations. The brokerage noted that Gagillapur clearance in FY27 could pose an upside to formulation sales estimates, while growth in the Senn (peptide CDMO) segment, subject to conversion of large-scale project opportunities, could be nonlinear in the medium term. The recent capital raise is expected to keep inorganic opportunities in play.
Emkay Global expects Granules India to deliver an EPS CAGR of approximately 20% over FY26-28E. The brokerage positions the company as their high-conviction small-cap pick, fitting into their framework of backing companies with a smaller US base and strong near-term growth visibility. The analysis suggests that the company's diversification strategy across multiple growth vectors positions it well for sustained expansion in the pharmaceutical sector.
