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Scaling up Launches while Investing for Next Growth Phase

We maintain a positive view on GNP, supported by continued scale-up of key launches including Semaglutide, respiratory and dermatology products, alongside ongoing business development and partnership expansion. While revenue growth may moderate to high single digit in FY27E, we view this largely as a consequence of the elevated FY26 base rather than any change in demand trends or strategic direction. Similarly, EBITDA margin may see a planned contraction due to the absence of the onetime AbbVie settlement income and higher operating expenses associated with launch scale-up. That said, the company’s long-term growth strategy and execution trajectory remains intact. We revise our FY27/28E estimate downwards by 0.3%/3.2% and continue to value the stock at 25x FY28E EPS. Our revised TP stands at INR 2,590 (earlier INR 2,175) with an ‘ADD’ rating.

Soft Topline, Strong Profitability

* Revenue grew 15.8% YoY but declined 3.3% QoQ to INR 37,706 Mn (vs. CIE estimate: INR 40,621 Mn).

* EBITDA grew 35.9% YoY but declined 12.3% QoQ to INR 7,626 Mn (vs. CIE estimate: INR 7,678 Mn); margin expanded 300 bps YoY and contracted 207 bps QoQ to 20.2% (vs. CIE estimate: 18.9%).

* APAT increased 182.2% YoY and 9.1% QoQ to INR 5,916 Mn (vs. CIE estimate: INR 5,186 Mn).

From Landmark Deals to Product Scale-up: Growth Drivers Remain Intact

FY26 was a landmark year for the company, marked by significant achievements across business development, product launches and strategic partnerships. Key highlights included the AbbVie deal (its largest to date), debt repayment and multiple oncology partnerships. While the revenue growth rate may moderate from the high FY26 base, the underlying growth drivers remain firmly in place: India: Expected to remain the key growth engine, supported by scale-up of Tevimbra, Brukinsa and Semaglutide, alongside continued strength in dermatology and respiratory therapies. North America: Growth to be driven by ramp-up of recent launches including Fluticasone, Gabapentin and other respiratory products. Europe: Growth may moderate to high single digit, supported by continued expansion of the base business. RoW: Healthy growth is expected on the back of the Ryaltris launch in Brazil, Envafolimab pipeline opportunities and other oncology launches.

Investment-led Margin Moderation to Support Future Pipeline Expansion

EBITDA margin saw a sharp expansion in FY26, aided by the AbbVie settlement and lower R&D spend related to ISB-2001. However, FY27E is likely to witness a planned contraction as the company increases investment in expanding its oncology franchise and supporting the upcoming US launches. We view these investments as critical to strengthening the long-term growth pipeline rather than a near-term margin concern. The management expects EBITDA margin to remain in the 21–22% range in FY27E.

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