Nomura on Crompton Greaves
Nomura raised the target price to Rs 335 from Rs 318 for Crompton Greaves, implying an upside of 18% from the current market price. It has recommended a ‘Buy’ rating on the stock.
With summer demand picking up well and the benefit of a low base, the brokerage house maintained Electrical Consumer Durables (ECD) growth of 14% for FY27 and 11% YoY for FY28.
The company is striving for growth across categories – Solar, Wires, premiumisation, etc., which can drive the upside risk to the brokerage’s estimates depending on execution, and remains a key monitorable.
However, steep near-term cost pressures and investments into new categories could lead to normalised margins by FY28.
“It has taken a total price hike of 7-8%, largely in Q4 FY26, but more hikes are required to pass on the entire cost. Has gained market share across segments, and new segments like BLDC are doing well,” said Nomura.
Nomura on Cipla
Nomura maintained its ‘Buy’ rating on Cipla, with a target price of Rs 1,510, an upside of 17%.
The company’s management expects double-digit growth in India ahead of the broader market in India. The company expects the US quarterly revenue run-rate to rise from $150 million in Q4 FY26 to $250 million in Q4 FY27, driven by high-value launches in respiratory and peptide segments.
“The guidance doesn’t factor in the contribution from Lanreotide. This is higher than our estimates, as we have factored in $907 million in FY28. For FY27E, management expects EBITDA margins at 18.5-20.0% vs our estimate of 19.4%,” said Nomura.
Nomura on Dr Reddy’s Lab
Nomura maintained its ‘Buy’ rating on Dr Reddy’s Lab, with a target price of Rs 1,600, implying an upside of 26% from the current market price.
The company expects double-digit revenue growth to sustain across all markets, excluding North America Generics (NAG). Even in NAG, excluding the contribution from gRevlimid in FY26 and the likely contribution from Semaglutide in Canada in FY27, the company expects double-digit growth.
The company expects gross margin at 50-55% going ahead (vs 48% adjusted gross margin in 4QFY26) and EBITDA margin (including other income) at 20% ex-Semaglutide. The company expects to sell 10-11 million units of Semaglutide, with realisation per unit ranging from $25-75 per unit. The outlook is largely in line with or marginally ahead of our current estimates.
“We believe earnings quality will improve going ahead with higher contribution from India and ex-US markets, which could drive valuation multiples higher, in our view,” Nomura.
Disclaimer: This article provides factual analysis only and is not, and should not be construed as, an offer, solicitation, or recommendation to buy or sell securities. Investors must conduct their own independent due diligence and seek advice from a SEBI-registered financial advisor.
