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Business Overview:

GNP is a global pharmaceutical company with operations across India, North America, Europe and emerging markets, spanning branded formulations, generics and specialty therapies. The company is strengthening its growth profile through scale-up of key products such as Ryaltris, Tevimbra, Brukinsa and Semaglutide, while expanding its respiratory, oncology and injectable portfolios. With increasing focus on innovative therapies, strategic partnerships and differentiated product launches, GNP is evolving into a diversified, specialty-led pharmaceutical platform with broad-based global growth drivers.

What is driving GNP’s transition into a specialty-led growth company?

The company is moving beyond its traditional generics base by building a portfolio of differentiated specialty and innovative products across oncology, respiratory and metabolic therapies. The company is scaling key launches such as Tevimbra, Brukinsa and Semaglutide in India, while expanding the global reach of Ryaltris, which has already crossed USD 100 Mn in revenue and is commercialised across 55 markets. In parallel, GNP is strengthening its innovative oncology pipeline through assets such as Envafolimab, Aumolertinib and Trastuzumab Rezetecan, positioning itself for a more sustainable and higher-value growth trajectory

Why are near-term margin investments a positive for GNP’s long-term outlook?

The management expects EBITDA margin to moderate to 21–22% in FY27E as it increases investments behind oncology expansion, specialty products and upcoming US launches. While this may weigh on near-term profitability, these investments are directed toward strengthening the company’s future launch pipeline and expanding its presence in higher-margin, differentiated therapy areas. Combined with a significantly improved balance sheet and reduced leverage, GNP is well-positioned to fund future growth initiatives while enhancing the quality and sustainability of earnings over time.

How can GNP sustain growth despite moderation after a strong FY26?

While growth is expected to normalise following an exceptionally strong FY26, the underlying growth drivers remain intact across geographies. India continues to benefit from strong momentum in oncology, respiratory, cardiovascular and diabetes therapies, while North America is poised for acceleration through the ramp-up of Fluticasone, respiratory products, injectables and potential first-to-file launches. Europe is supported by respiratory expansion and the rollout of Winlevi, while emerging markets are benefiting from Ryaltris expansion and oncology launches. This diversified growth engine provides visibility for sustained double-digit earnings growth over the medium term

Why Invest in GNP?

* Specialty-Led Growth: GNP is scaling high-growth products such as Ryaltris, Tevimbra, Brukinsa and Semaglutide while expanding its innovative oncology pipeline, supporting a transition towards a higher-value specialty pharma business.

* Multi-Geography Growth Visibility: Growth is supported by strong momentum across India, the US, Europe and emerging markets through respiratory, oncology and injectable launches, reducing reliance on any single geography

Recommendation: We currently have a ‘ADD’ rating on the stock with a target price of INR 2,590.

Key Risks:

* Launch Scale-up and Commercialisation Risk: The company’s growth outlook is increasingly dependent on successful scale-up of recent launches including Semaglutide, Tevimbra, Brukinsa, Fluticasone and respiratory products, where slowerthan-expected market adoption, delayed commercialisation or execution challenges across key geographies could moderate revenue growth.

* Margin Dilution from Elevated Investments: The company is stepping up investments in oncology, respiratory therapies and specialty products, with R&D spend expected to remain at 7–8% of sales and operating expenses increasing to support upcoming launches, which could pressure profitability and limit margin expansion if incremental revenues from new products and partnerships scale up slower than anticipated.

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SEBI Registration no.: INZ 000160131