Lupin Share price rises 3% to multi year high: Should you Buy, Sell or Hold post more than 56% ytd gains

Stock Market Today: Lupin share price saw strong gains of more than 3% on Thursday as the stock touched multiyear high  on the bourses. : Lupin share price had last seen such levels in 2015. The Lupin share price opened at ₹2,019.95 almost 1.2% higher over the previous close of ₹1,994.45. Lupin share price thereafter touched all time highs of ₹2,066.90 on the NSE marking gains of more than 3%.

Lupin share price has gained more than 56% year to date as growth prospects improved. During the Quarter Ending June (Q1) it has delivered a strong earnings performance led by a superior show in the key markets of the US and India) and further helped by lower R&D spending and a lower tax rate.

Strong US and Domestic growth

The Domestic sales contributing 35% to overall revenues at ₹1926 Crore grew 17.5% yoy (20.3% sequentially). The company highlighted that its prescription business grew 10.5% yoy, higher than Indian Pharma market growth of 8.5%.

The North American business contributing 37% to overall for Lupin at ₹2041 crore also grew 28.3% y-o-y, 7.5% sequentially .

Strong Net profit growth and Ebitda

Lupin the highest quarterly Ebitda margin in five years said analysts . At ₹1309 crore the Ebitda grew 27.5% sequentially and 28.5% year in year. With margins at 23.7% better than 21% in the previous quarter and 18.5% in the year ago quarter. Ebitda stands for Earnings before interest tax depreciation and amortisation (Ebitda)

The reported net profit at ₹801.3 Crore more than doubled sequentially (up 118%) and

Analysts Views

Analysts at Motilal Oswal Financial Services expect Lupin to sustain strong earnings growth momentum in FY25 and FY26 after a turnaround in FY24. The improved traction across its key markets is helping resulting in better operating leverage. They estimate a 30% earnings CAGR (compound annual growth) in earnings over FY24-26, However they have Neutral Ratings on the stock

Analysts at Prabhudas Lilladher on the other hand have revised their FY25 and FY26 estimated Earnings per share upwards +20% as they factor in higher margins and US sales and upgrade the stock from HOLD to BUY with revised TP of Rs2,300 a share ( from Rs1,675 earlier).

Those at Antique Stock Broking remain optimistic on Lupin's US generic opportunities with limited competition launches, and increase FY26 earnings estimate by 11% on account of higher gross margins. Their target price stands at ₹2125

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions