According to reports from Prabhudas Lilladher, the brokerage has issued an 'Accumulate' rating on Zydus Lifesciences with a target price of ₹1,080. The recommendation is based on the company's Q4 EBITDA performance that was sharply above estimates, aided by higher revenues across key markets. The valuation is set at 23x FY28E EPS for the pharmaceutical company.
As reported by Prabhudas Lilladher, the company's Q4 EBITDA was sharply above estimates, driven by higher revenues across key markets. The brokerage believes the base business remains steady with mild erosion, indicating stable operational performance despite some market challenges. The company is currently working on a robust pipeline of complex products, including injectables, 505(b)2, transdermals, NCE, biosimilars and vaccines, which are expected to materialize over the next 2-3 years.
According to the research report, Prabhudas Lilladher expects US sales to remain largely flat over FY26-28E given sales erosion in some key products. The brokerage anticipates flat EPS CAGR adjusted for forex over the same period. Management has guided for 2-3 high value launches over FY27E/28E, with timely launch being key to sustaining momentum in US sales. The company's focus on complex product development is expected to drive future growth over the medium term.
