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Scaling up of US Platform & Product Launches Drive Earnings Growth

We expect SENORES to deliver a stronger H2FY27, supported by robust product launches and revenue contribution from Zoraya and Amerisyn. We project a revenue CAGR of ~30% in the next three years in line with management guidance. This growth will be driven by commercialisation of approved ANDAs, including 4–5 planned controlled-substance launches, 944+ product registrations across Emerging Markets and expanding geographic reach through PIC/S approval. While the management has guided for an EBITDA margin of ~30%, we forecast EBITDA margin at 28–29% over FY27E–FY28E, with further upside as Zoraya and Amerisyn scale up. We value the stock at 30x FY28–29E average EPS, resulting in a revised TP of INR 1,700, while retaining our ‘BUY’ rating. The implied PEG ratio of 0.8x further supports our constructive valuation outlook.

Revenue Miss Overshadows Strong Operating Performance

* Revenue grew 24.9% YoY / 6.7% QoQ to INR 1,923 Mn (vs. CIE estimate of INR 2,071 Mn).

* EBITDA grew 38.3% YoY / 7.3% QoQ to INR 577 Mn (vs. CIE estimate of INR 652 Mn); margin expanded 290 bps YoY / 15 bps QoQ to 30.0% (vs. CIE estimate of 31.5%).

* PAT increased 22.1% YoY / 28.5% QoQ to INR 395 Mn, in line with CIE estimate.

Pipeline Execution Supports Growth across Regulated & Emerging Markets

The company delivered its highest-ever quarterly revenue and EBITDA in Q2FY27, reinforcing our confidence in its execution capabilities. We anticipate this momentum to sustain, translating into a revenue CAGR of 29.8% in the next three years. We believe growth will be driven by continued traction across both, regulated and emerging, markets, with H2FY27 projected to be stronger than H1FY27

* Regulated Markets: We expect regulated markets to remain the key growth engine, supported a robust pipeline of 41 approved ANDAs including 4–5 controlled substance launches. We anticipate Zoraya and Amerisyn to start contributing from H2FY27, with a more meaningful revenue contribution estimated from FY28. The management is targeting over 10 product launches under Amerisyn with additional 3–4 ANDA approvals expected in Q3FY27. As Apnar scale-up also progresses as planned with the plant operating at optimal utlisation, along with the addition of two new commercial lines taking the total capacity to ~1.2 Bn units, we project commercialisation capabilities to strengthen beyond FY27.

* Emerging Markets: We remain positive on the emerging markets outlook, underpinned by 500+ approved products and 944 registrations under review, providing a healthy launch pipeline in the next few quarters. In addition, the rollout of GLP-1 products across 18–20 markets should support portfolio premiumisation and incremental growth. As the impact of low-margin beta-lactam orders fades from Q3FY27 and operating cash flows remain positive, we project margin to recover while supporting continued investments in growth.

Business Mix to Drive 28–30% EBITDA Margin

EBITDA margin continued to expand in this quarter and we forecast this trend to sustain, supported by a more favourable product mix and operating leverage. Accordingly, we expect EBITDA margin in the range of 28–30% across FY27E–FY29E

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