Target: ₹ 1,732
CMP: ₹1,438.65
Cipla Q4-FY26 Revenue (₹6,541.20 crore -3 per cent yoy), EBTIDA (₹997 crore down by 35 per cent yoy) and net earnings (₹554.60 crore down by 55 per cent yoy), were below consensus expectations, but above our estimates. Strong growth in India (15 per cent yoy) and Africa (21 per cent yoy) was offset by sharp decline in North America (-26 per cent yoy). 15 per cent growth in India was supported by 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 yoy growth.
North America declined owing to loss of high value products like gRevlimid and lanreotide discontinuation. EBTIDA margins dipped 760bps yoy owing to decline in high value assets and increase in R&D investments. R&D costs were higher by 20 per cent yoy and stood at 7.8 per cent of sales vs 6.3 per cent of sales in Q4-FY25.
The 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