Geojit Financial Services has reiterated its BUY recommendation on Lupin Limited, raising the target price to Rs 2,606 from the current market price of Rs 2,261, implying a potential upside of nearly 15% over the next 12 months. The bullish outlook is underpinned by Lupin’s accelerating momentum in the U.S. generics market, robust growth across key geographies, expanding respiratory portfolio, and increasing focus on complex generics, biosimilars, and specialty products. Strong operating leverage drove a significant margin expansion during FY26, while management remains confident of sustaining healthy revenue growth through continued investments in research and development and a deep product pipeline.

Geojit Reaffirms BUY Call as Lupin Strengthens Global Growth Engine

Research house: Geojit Financial Services

Rating: BUY

Current Market Price (CMP): Rs 2,261

Target Price: Rs 2,606

Potential Upside: 15%

Lupin continues to demonstrate strong execution across its global pharmaceutical operations, supported by healthy demand in the U.S., India, and emerging markets. The company’s strategic emphasis on complex generics, respiratory therapies, injectables, and biosimilars is increasingly translating into stronger earnings visibility and improved competitive positioning.

Q4FY26 Performance Reflects Strong Operational Momentum

The pharmaceutical major reported an impressive set of numbers during the fourth quarter of FY26, driven by broad-based growth across geographies and product categories.

Revenue for the quarter surged 31.9% year-on-year to Rs 7,475 crore, reflecting strong demand trends and successful product launches. North America remained the primary growth engine, while India and Latin America also delivered meaningful contributions.

EBITDA increased 68% YoY to Rs 2,171 crore, supported by operating leverage and improved product mix. EBITDA margin expanded sharply by 624 basis points to 29%, highlighting the company's improving profitability profile.

Adjusted profit after tax climbed 106% YoY to Rs 1,592 crore, while adjusted earnings per share rose to Rs 34.8 from Rs 16.9 a year earlier.

North America Continues to Lead Growth Story

Lupin’s North American business delivered one of its strongest quarters in recent years.

Revenue from the region jumped 55% year-on-year to Rs 3,515 crore, aided by a combination of fresh product launches, higher volumes from existing products, and increasing contributions from complex injectables.

The company currently commands approximately 4.8% generic prescription volume share in the United States and ranks among the leading generic pharmaceutical players. Management highlighted that Lupin holds leadership positions in 61 products and remains among the top three players in 112 products in the U.S. market.

India Business Maintains Healthy Double-Digit Expansion

Domestic operations also remained resilient despite an increasingly competitive pharmaceutical landscape.

India revenue grew 11.5% YoY to Rs 1,908 crore, driven by prescription growth of 14.5%, which outperformed the broader Indian Pharmaceutical Market.

The company witnessed strong traction in respiratory and cardiac therapies while benefiting from new product introductions across multiple therapeutic segments. This sustained momentum reinforces Lupin’s leadership position within the domestic formulations market.

Latin America Rebound Adds Another Growth Lever

One of the standout developments during the quarter was the remarkable turnaround in Latin America.

Revenue from the region surged 75% year-on-year to Rs 314 crore, supported by improved execution and stronger market performance in Brazil.

Management indicated that operational discipline and better commercial execution have helped the region emerge as a meaningful contributor to overall growth, strengthening Lupin’s geographical diversification strategy.

R&D Investments Continue to Build Long-Term Competitive Advantage

A key pillar of Lupin’s strategy remains its commitment to innovation.

Research and development spending represented 8% of sales during Q4FY26 and 7.5% of annual revenue in FY26. These investments are being directed toward complex generics, respiratory therapies, biosimilars, specialty products, and differentiated formulations.

The company currently maintains a pipeline of more than 50 products, with several launches expected over the next two years through its growing 505(b)(2) platform. Management also plans to accelerate filings, targeting over 15 ANDA submissions in FY27, compared with more than 10 filings during FY26.

Complex Generics Strategy Gains Momentum

Lupin's management believes the next phase of growth will be driven by high-value complex products rather than conventional generic medicines.

The company aims to launch over 100 products in the coming years, with complex products expected to contribute more than 65% of revenue by FY31.

In addition, Lupin maintains a robust pipeline comprising 52 First-to-File opportunities, including 22 exclusive products, which could significantly enhance future earnings potential and market share gains in the United States.

Financial Outlook Remains Constructive Despite Normalization

While FY26 benefited from exceptional profitability gains, management has guided for more normalized but still healthy growth going forward.

For FY27, the company expects high single-digit revenue growth and EBITDA margins around 25%.

Geojit has revised its estimates upward, reflecting stronger confidence in Lupin's operating trajectory.

Geojit increased FY27 earnings estimates by approximately 13%, reflecting stronger operational performance and improved margin assumptions.

Investment View: Why Analysts Remain Positive

Several factors continue to support the investment case for Lupin:

Strong leadership in the U.S. generics market.

Rapidly expanding respiratory and complex injectable portfolio.

Robust ANDA pipeline and First-to-File opportunities.

Growing biosimilar and specialty business capabilities.

Healthy balance sheet and improving cash generation.

Sustained R&D investments supporting long-term growth visibility.

Diversified geographical presence reducing business concentration risk.

These factors collectively provide a solid foundation for future earnings expansion and market share gains.

Technical Levels and Investor Strategy

From a trading and investment perspective, the stock remains fundamentally strong after its recent outperformance versus broader market indices.

Current Price: Rs 2,261

Target Price: Rs 2,606

Expected Upside: 15%

Immediate Support Zone: Rs 2,150–2,200

Major Support Zone: Rs 2,000–2,050

Near-Term Resistance: Rs 2,450–2,500

Target Zone: Rs 2,606

Investors with a medium-term horizon may continue accumulating the stock on declines, supported by improving earnings visibility and Lupin's strengthening position in high-value pharmaceutical segments.