Buy Glenmark Pharma; target of Rs 3000: Motilal Oswal

Motilal Oswal's research report on Glenmark Pharma

Glenmark Pharma (GNP) delivered a better-than-expected operational performance in 2QFY27, with 5% beat on revenue/EBITDA. Earnings were largely in line as the impact of higher-than-expected EBITDA was offset by lower other income. On like-to-like basis, GNP outperformed industry in domestic formulation segment by almost 300bp for the quarter, backed by superior execution in cardiology, dermatology and respiratory segment. It continued to launch differentiated oncology, respiratory as well as dermatology product, supporting better growth prospects in DF segment. Excl. licensing income, GNP delivered healthy growth in North America (NA), largely led by product launches. Work is ongoing on additional respiratory filings in MDI/Nasal sprays. EM delivered strong performance in 2QFY27, driven by robust secondary sales growth, continued market outperformance, portfolio expansion, and strong execution across regions.

Outlook

We largely maintain our estimates for FY27/FY28. We value GNP at 26x 12- month forward earnings to arrive at a TP of INR3,000.