Lupin share price: Shares of pharmaceutical player Lupin jumped over 5 per cent in morning trade on BSE on Thursday, July 4, following a double upgrade from brokerage firm Kotak securities. Lupin share price opened at ₹1645 against its previous close of ₹1630.80 and rose over 5 per cent to the level of ₹1,714.10. The stock, however, pared some gains and traded 2.85 per cent higher at ₹1,677.20 apiece around 10:05 am.
Brokerage firm Kotak Institutional Equities (Kotak Securities) has upgraded Lupin stock to an 'add' from a 'sell', raising the fair value to ₹1,805 from ₹1,400 earlier. This implies an upside potential of nearly 11 per cent from the stock's previous close.
"Our analysis of Lupin’s US portfolio leads us to believe that it is well-poised to surprise positively on Street’s estimates in the US in FY25E/26E. While we remain cognizant of not ascribing a high multiple to one-off earnings, we highlight Lupin has a bunch of products lined up, which will ensure a limited earnings dip in FY2027E after a strong FY2026E," Kotak said.
"We raise FY25-27E EPS (earnings per share) by 3-16 per cent with our FY25/26E EPS now being 6/13 per cent higher than Street. We double upgrade Lupin to 'add' from 'sell' with a fair value of ₹1,805," said Kotak.
Kotak expects Lupin's healthy US sales trajectory to continue despite a drop in Albuterol and gSuprep in FY25E.
It said while gSpiriva and Albuterol will continue to remain critical with a combined US sales contribution of $216 and $188 million in FY25E and FY26E, respectively, gMyrbetriq and Tolvaptan will be key to driving its US sales in FY25E and FY26E, respectively.
Kotak believes that FY26 will be a noteworthy year in the US for Lupin, particularly aided by the Tolvaptan launch in April 2025.
The brokerage firm expects a healthy 12 per cent year-on-year (YoY) and 11 per cent YoY growth in US sales in FY25E ($914 million) and FY26E ($1,013 million), respectively, for Lupin.
Kotak believes there is still a possibility of further positive surprises if Lupin continues to gain share in gSpiriva and if there is a lower-than-expected hit from Albuterol competition.
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On the stock's valuation front, Kotak said it ascribes a June 2026E PE (price-to-earnings) multiple of 25 times from 22 times earlier due to better medium-term sales and margin outlook.
Lupin share price has been on a roll over the last year, surging nearly 83 per cent on the BSE. The stock hit its 52-week high of ₹1,727.90 on May 22 this year, while its 52-week low level is ₹889.85, which it hit on July 7 last year.
While the long-term prospects of Lupin stock look attractive, some experts suggest waiting for some time to initiate fresh long positions in the stock.
Experts say the stock has been struggling to cross ₹1,730 level.
Jigar S. Patel, Senior Manager of Equity Research at Anand Rathi Share and Stock Brokers, pointed out that over the past five months, Lupin's stock has fluctuated within a price range of approximately ₹1,545 to ₹1,730.
In the latest trading session, the stock faced significant selling pressure after reaching a high of ₹1,713, indicating that sellers are actively offloading their shares at the upper end of this range. Patel observed that this selling activity suggests resistance to higher price levels within the defined trading range.
"We recommend traders to take advantage of this resistance by booking profits when the stock price is between ₹1,700 and ₹1,710. For those looking to initiate new long positions, waiting for a decisive daily close above ₹1,735 is prudent, which would signal a potential breakout from the current trading range and a favourable condition for further upward movement," said Patel.
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