Piramal Pharma surges 18% to 18-month high as Q2 results beat estimates; brokerage upgrades to Add, check target price

Piramal Pharma Q2 results Piramal Pharma clocked a consolidated net profit of Rs 5 crore in the July-September period of the current fiscal year compared with loss of Rs 99.22 crore in the year-ago period, the company said in a regulatory filing on Tuesday. Analysts had expected the company to report a net loss for the sixth consecutive quarter, with the loss estimated at Rs 71.74 crore. The Mumbai-headquartered company's revenue from operations rose over 28 percent year-on-year and over 15 percent sequentially to Rs 2,617 crore, surpassing analysts' estimate of Rs 2,327 crore by a wide margin.

Its total expenses, too, grew to Rs 2,589.10 crore in the September quarter from Rs 2,170.29 crore in the corresponding period of the previous year. The stock closed 16.04 percent higher at Rs 230.60 on the NSE. It opened at Rs 214.10 and climbed as much as 18.57 percent to hit an intraday high of Rs 235.64, compared with the previous close of Rs 198.72. Piramal Pharma share up 23% in three sessions

Shares of Piramal Pharma have rallied nearly 23 percent over the past three trading sessions, extending their recent gains. At close, the stock settled 16.04 percent higher at Rs 230.60 apiece. Trading activity picked up sharply on Wednesday, with more than 97 million shares changing hands on the exchanges, over nine times the volume recorded at the same time on Tuesday, reported Reuters. The stock has gained nearly 13 percent so far in October and is up 35.74 percent year-to-date.

The stock has surged 14.10 percent in one year while 149.30 percent in three years, according to NSE data. Choice Institutional Equities on Piramal Pharma share – Add, target price Rs 250 Following the strong quarterly performance, domestic brokerage Choice Institutional Equities upgraded its rating on Piramal Pharma to ‘Add’ and set a target price of Rs 250, indicating a potential upside of around 8.7 percent from the stock's closing price on Wednesday.

The brokerage expects the company's recovery to gather pace in the second half of FY27, supported by improving revenue growth and operating leverage. According to Choice Institutional Equities, H1FY27 has seen a healthy recovery in revenue and margins, supported by the contract development and manufacturing organisation (CDMO) segment, the scale-up of complex product launches and brand premiumisation.

“We project this momentum to continue, driven by improved order inflows from better biopharma funding, a meaningful contribution from Kenalog and continued growth in power brands and e-commerce,” it said. Choice Institutional Equities values Piramal Pharma at 18 times its average estimated FY28-FY29 enterprise value-to-EBITDA (EV/EBITDA). The brokerage noted that elevated tax rates arising from carried-forward losses at overseas facilities understate the company's earnings potential.

The revised target price of Rs 250 and the upgrade to ‘Add’ reflect the brokerage's improved outlook for the company, alongside an implied price-to-earnings growth (PEG) ratio of 0.8 times.