Target: ₹ 1,732

CMP: ₹1,438.65

Cipla Q4-FY26 Revenue (₹6,541.20 crore -3 per cent y-o-y), EBTIDA (₹997 crore down 35 per cent y-o-y) and net earnings (₹554.60 crore down by 55 per cent y-o-y), were below consensus expectations, but above our estimates. Strong growth in India (15 per cent y-o-y) and Africa (21 per cent y-o-y) was offset by sharp decline in North America (-26 per cent y-o-y). 15 per cent growth in India was supported by in licensing deals. The quarter potentially included meaningful contribution from in-licensed assets - Eli Lilly obesity drug and Pfizer portfolio (Corex, Dolonex and Neksium) which together would have contributed about 400-500 bps to y-o-y growth.

North America declined owing to loss of high value products like gRevlimid and lanreotide discontinuation. EBTIDA margins dipped 760bps y-o-y owing to decline in high value assets and increase in R&D investments. R&D costs were higher by 20 per cent y-o-y and stood at 7.8 per cent of sales vs 6.3 per cent of sales in Q4-FY25.

Company expects full year EBITDA margins to be in the 18.5-20 per cent range, with margins picking up in the second half led by ramp up in US. By Q4-FY27, US run rate is expected to reach close to $250 million (currently $155 million). We are currently not factoring in the US guidance in our numbers. gVentolin, gAdvair, gSymbicort and teduglutide are the key expected launches.

.

Based on our revised estimates, we retain Buy with a PT of ₹1,732 (25x FY28E EPS).

Published on May 14, 2026