JM Financial has retained Buy ratings on both Dr Reddy's Laboratories and Aurobindo Pharma, projecting significant upside potential over the next 12 months. The brokerage maintains its ₹1,489 target for Dr Reddy's, implying a 27.7% upside, while raising Aurobindo Pharma's target by 4.3% to ₹1,975, indicating a potential gain of 17.6%. According to reports from The Economic Times, the brokerage expects stronger earnings growth, business diversification and new product launches to support both drugmakers.
JM Financial expects Dr Reddy's earnings per share to reach around ₹80 in FY28 and ₹91 in FY29, while the EBITDA margin could recover to 25% by FY29. The brokerage values the stock at 18 times its estimated June 2028 earnings. Key growth drivers include the planned semaglutide relaunch in November 2026, the potential launch of intravenous Abatacept in the fourth quarter of FY27, stronger growth in India and expansion of consumer health. The company has identified the manufacturing issue that affected semaglutide production, although successful validation remains critical to the relaunch.
JM Financial forecasts revenue, EBITDA and profit after tax to grow at compound annual rates of 14%, 20% and 28% respectively between FY26 and FY29. The brokerage values the stock at 17 times its estimated September 2028 earnings. The US business is expected to deliver high-single-digit growth, supported by market-share gains and capacity expansion. Aurobindo's US market share reached 11.2% in July, while capacity is projected to rise to around 78 billion units by the end of FY27.
According to The Economic Times, Dr Reddy's shares have declined 12.87% over the past year, underperforming the benchmark's 7.85% fall. The stock touched its 52-week low of ₹1,101 on July 23, 2026, with the company's market capitalisation standing at ₹95,453 crore. In contrast, Aurobindo Pharma shares have rallied 50.62% over the past year, outperforming the benchmark's 5.90% gain, touching its 52-week high of ₹1,717 on August 31, 2026. The company's market capitalisation stood at ₹94,776 crore with a free-float market value of ₹45,425 crore.
