Prabhudas Lilladher has issued a REDUCE rating on Sudeep Pharma with a target price of ₹855 in its research report dated August 06, 2026. According to the brokerage's assessment, the company is valued at 45x FY28 EPS. The downgrade reflects concerns about the pharmaceutical company's recent performance and future prospects.
Sudeep Pharma reported consolidated revenue of ₹158.27 crore in Q2FY26, representing a 13.20% decline from Q1FY26. As reported by Prabhudas Lilladher, the company's net profit fell 16.38% to ₹40.59 crore during the quarter. The Specialty Ingredients (SI) segment demonstrated mixed results with 19% YoY growth but experienced a 46% QoQ decline, primarily attributed to subdued demand across certain NSS and disruption in LPG supply during the quarter. The SI business contributed 32% of total revenue during the quarter, while EBIT margin contracted sharply by 1,190 basis points both year-on-year and quarter-on-quarter.
The Pharmaceutical, Food & Nutrition (PFN) segment delivered robust performance with revenue increasing 31% YoY and 20% QoQ, according to Prabhudas Lilladher's report. This strong performance in the PFN segment helped offset some of the challenges faced by the Specialty Ingredients division. The company's diversified portfolio across pharmaceuticals and specialty ingredients continues to show resilience despite market headwinds in certain segments.
The company's pCAM project remains on track for Phase 1 commissioning by April 2027, as reported by Prabhudas Lilladher. During Q1FY27, Sudeep Pharma signed two additional strategic MoUs and is already planning for capacity expansion beyond 100ktpa to 200ktpa. These strategic initiatives demonstrate the company's commitment to scaling operations and diversifying its revenue streams beyond traditional pharmaceutical and specialty ingredients segments.
Despite the rating downgrade, Sudeep Pharma shares have shown resilience, inching up 0.10% to ₹869.45 in recent trading. The company's market capitalization stands at ₹24.82 lakh crore, with the pharmaceuticals industry group stocks on BSE showing a 6.18% decline. The stock has demonstrated strong long-term performance, jumping 12.38% in the last one year, significantly outperforming the benchmark BSE Sensex which has slipped by 3.20% during the same period. The company announced that its 37th Annual General Meeting will be held on August 4, 2026, with the Board of Directors meeting scheduled for the same day.
