Buy Cipla: target of Rs 1610: ICICI Securities

What happened

ICICI Securities said Cipla's Q2FY27 operating performance met its expectations, though strong prior-year gRevlimid sales weighed on reported results. US sales rose 6.2% quarter over quarter to USD 172mn, and ICICI kept a BUY rating with a target of Rs 1610.

Confirmed

Global impact / market context

The report ties Cipla's outlook to US sales climbing toward a USD 250mn quarterly run-rate by Q4FY27, driven by new respiratory and peptide product launches. If that happens, it could support revenue growth and the company's stated margin guidance of 18.5-20%.

Analyst inference

ICICI cut its earnings per share estimates for the next two fiscal years by about 12% and 4%, citing lower other income and US sales. The unchanged Rs 1610 target suggests the broker sees long-term value despite softer near-term profit expectations.

Analyst inference

What to watch

1. Cipla secured approvals for two respiratory products, gVentolin and gAdvair, in H1FY27, and expects approvals for two more respiratory products plus one peptide product in H2FY27. Confirmed
2. ICICI's Rs 1610 target assumes Cipla's US sales reach a USD 250mn quarterly run-rate by Q4FY27 and that margins expand sequentially over the next two quarters. Proposed
3. Watch whether Cipla's branded portfolio keeps growing on chronic therapies and GLP-1 products, and whether trade generic and consumer portfolios regain double-digit growth as management expects. Analyst inference

Evidence

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