Ipca Laboratories has made headlines once again, with its share price surging to a lifetime high. On Tuesday, the stock price jumped by 3.66% intraday, reaching ₹1,509.45 per share on the Bombay Stock Exchange (BSE). This sharp rise came after global brokerage firm Nomura raised its target price for the stock from ₹1,457 to ₹1,750, maintaining a 'buy' rating and predicting a 20% upside. The news has sparked renewed interest among those looking to invest in stocks, particularly in the pharmaceutical sector.
Nomura raises target price for Ipca Labs
Nomura's bullish stance on Ipca Laboratories stems from the stock's consistent performance and future potential. The brokerage firm values the stock at 32.5 times its one-year forward earnings (as of September 2026), with an earnings per share (EPS) estimate of ₹54. Nomura expects the stock to trade at a higher multiple of 30-35x due to the strong market valuation of its peers.
Analysts noted that the company's domestic formulation market continues to outperform, contributing significantly to its valuation. “The business attracts a higher valuation multiple, and we believe it will contribute 50 per cent of FY26/27F EBITDA. Additionally, there is scope for improvement in other business segments, particularly generics and active pharmaceutical ingredients (API),” said Nomura analysts Saion Mukherjee and Amlan Jyoti Das.
Strong earnings growth and future outlook
Ipca Laboratories is expected to maintain strong earnings growth, with analysts predicting a 30% compound annual growth rate (CAGR) from FY25 to FY27. The company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) is projected to reach 23.6% by FY27, driven by investments in biologics and the revival of contract drug development and manufacturing (CDMO) services.
Ipca's management is optimistic about the company's growth trajectory, aiming for a 1.4x growth rate of the Indian pharmaceutical market and a 12% revenue increase in FY25, despite a weaker seasonal demand. Investors looking to invest in stocks may find this growth projection encouraging, as it demonstrates Ipca's ability to navigate challenges and expand its footprint in the global pharmaceutical market.
Expanding opportunities in international markets
Beyond domestic growth, Ipca Laboratories is also focusing on scaling its international revenues. The company is particularly eyeing growth in the US market through its subsidiaries, Unichem and Bayshore, which are expected to contribute to revenues with new product launches and tender wins. According to the management, US revenues could climb to $200 million in the near term, providing further reasons for those looking to invest in stocks to consider Ipca as a strong candidate.
Additionally, the company is exploring opportunities in new markets outside the US, such as Germany, where it plans to expand its generics portfolio. With such global aspirations, Ipca Laboratories has positioned itself as a compelling option for investors wanting to capitalise on international pharmaceutical growth.
Valuation and stock performance
Ipca Labs currently boasts a market capitalisation of ₹40,809.55 crore. Its stock is trading at a price-to-earnings (P/E) multiple of 65.04 times, with an earnings per share of ₹22.39. Over the past year, the company's share price has fluctuated between a 52-week low of ₹886 and the recent 52-week high of ₹1,509.45.
As of 10:29 AM on Tuesday, Ipca Labs shares were trading at ₹1,487.70, up by 2.17%, while the BSE Sensex was trading 0.13% higher at 85,038 levels. This strong performance, coupled with Nomura's raised target price, makes Ipca Laboratories a stock to watch for investors looking to invest in stocks.
Conclusion
With its shares reaching a lifetime high and a favourable outlook from global analysts, Ipca Laboratories continues to be a strong player in the pharmaceutical industry. Nomura's raised target price and positive assessment of the company's growth potential have reinforced its status as a valuable asset for those keen to invest in stocks. As Ipca continues to expand its market presence and enhance profitability, investors may find this pharmaceutical giant a promising addition to their portfolio.
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