Torrent Pharmaceuticals: Buy Recommendation with Rs 4,232 Target Sharekhan

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Sharekhan, in its research report now, has sounded out Torrent Pharmaceuticals with a strong recommendation. It suggested that investors can target it at Rs 4,232 as the price tag is supported by recent improvements in Torrent's financial performances and prospects of growth across all the geographies it offers services from.

Financial Performance Snapshot

Torrent Pharmaceuticals reported revenue of Rs 2,889 crore. It came with a 9 percent year-over-year growth and a modest 1 percent growth quarter-over-quarter. EBITDA growth, too, was impressive with Rs 939 crore - it had risen 14 percent year-over-year and had increased 4 percent over the quarter. Torrent Pharma's EBITDA margin was notable at 33 percent, up 149 basis points year-over-year and 88 basis points quarter-over-quarter. Insulin is one of the major product lines in Torrent's portfolio and experienced a short impact from the scheduled maintenance shutdown in August. The plant is expected to come on stream in December, and the company is expecting significant recoveries in insulin sales during the fourth quarter. This setback will not have any material impact on Torrent's annual revenue.

Strong Growth Outlook

Sharekhan's report thinks that Torrent Pharmaceuticals has huge growth potential due to a strong product mix, which keeps the margin potential high on the company's side. The high-margin product with increasing demand across international markets will keep Torrent in a favorable position for sustained growth in the future. Margin Expansion Potential: Sharekhan expects further annual margin expansion of 50-100 basis points, largely due to a favorable product mix that continues to support high profitability. With a strong focus on enhancing operational efficiency, Torrent is well-positioned to seize market opportunities in both established and emerging markets.

Valuation and Target Price

Currently, Torrent Pharmaceuticals is trading at a valuation of 45x its FY2026E earnings and 36x its FY2027E earnings, which presents the high-margin profile as well as competitive product portfolios of the company. From this robust growth outlook, Sharekhan has targeted to reach Rs 4,232, thereby suggesting enormous upside for investors.

Conclusion

With an overwhelming geographical expansion and offering higher-margin products plus achieving efficiencies in operations, Torrent Pharmaceutical happens to be more solid towards growth. Here target for Sharekhan, priced at Rs4,232, going upwards works well for stock prices; investors looking long term might find value add-in Pharmaceuticals sector with a presence here.