Ajanta Pharma (AJP IN) – Q2FY27 Result Update – Strong beat; Growth across branded generic markets – BUY
Published on 01 Nov 2026
AJP’s Q2FY27 EBITDA grew strongly by 47% YoY (INR 5.43bn; 30.2% OPM) which was sharply above our estimates. The beat was aided by higher revenues across branded generic markets. The recent in-licensing agreement with Biocon for marketing semaglutide in 26 countries across RoW markets is good fit given its strong existing franchise across these markets. Further AJP’s play on high growth branded generics (BGx) market spread across India, Asia and Africa which contributed 70% to total revenue in FY26. Strong annual free cash flow of INR8–10bn further supports sustained investments and potential inorganic opportunities, reinforcing medium-term growth visibility. Our FY28E and FY29E EPS stands increased by 3-6%. Overall, we expect EBITDA/PAT CAGR of 20% over FY26-29E with healthy RoE/RoCE of 25%/31% in FY27E. At CMP, AJP is trading at 29x P/E and 20x EV/EBITDA as of FY28E. Maintain BUY rating with revised TP of INR4,250/share (32x Sept 2028E EPS).
