Choice Institutional Equities has upgraded its target price for Senores Pharma to ₹1,045 from the previous ₹1,010, while maintaining its BUY rating on the pharmaceutical company. The revision reflects improved margin outlook and strong growth prospects driven by the company's expanding product portfolio and geographical reach.

Strong Product Pipeline Drives Growth

Senores Pharma continues to demonstrate robust growth momentum, supported by an impressive pipeline across multiple markets. The company's development strategy encompasses both regulated and emerging market opportunities:

The brokerage highlighted that the company has consistently increased the contribution from its proprietary products across various regions, which has been a key driver of profitability improvements.

Revised Financial Projections and Margin Expansion

Choice Institutional Equities has updated its financial estimates following management's revised guidance on EBITDA margins. The firm now expects EBITDA margins to reach 29.00%, aligning with the company's updated guidance range, which represents an increase from the previous expectation of 24-26%.

The improved margin outlook has led to upward revisions in earnings estimates, with FY26E projections increased by 3.60% and FY27E estimates raised by 3.10%. These revisions reflect the faster-than-expected EBITDA margin expansion driven by higher contribution from proprietary products and ongoing backward integration initiatives.

Valuation Methodology and Investment Rationale

The brokerage's valuation approach centers on a price-to-earnings multiple of 30x applied to the average FY27-28E EPS, resulting in the revised target price of ₹1,045. The valuation framework is further supported by a PEG ratio of 0.61x, indicating attractive growth prospects relative to the earnings multiple.

Choice Institutional Equities emphasized that the company's geographical expansion strategy, combined with its strong launch pipeline, positions Senores Pharma well for sustained high-growth performance. The backward integration efforts are expected to continue supporting margin improvements while reducing dependency on external suppliers.

The maintained BUY rating reflects confidence in the company's execution capabilities and the pharmaceutical sector's growth potential in both regulated and emerging markets.

Senores Pharma has delivered a strong nine-month performance for FY26, with results that meet or slightly exceed the company's annual goals. The pharmaceutical company's robust performance in the first three quarters has positioned it well to achieve its ambitious full-year targets.

FY26 Growth Targets and Performance Outlook

The company has expressed confidence in achieving its FY26 targets, which include ambitious growth projections compared to FY25 performance:

The nine-month results indicate that Senores Pharma is on track to meet these substantial growth objectives, reflecting the company's strong operational performance and strategic execution.

Strategic Acquisition Impact

Senores Pharma's acquisition of Apnar Pharma is expected to contribute significantly to the company's future revenue streams. The acquisition is projected to generate substantial revenue contribution in the upcoming fiscal year:

This acquisition represents a strategic move to expand the company's market presence and revenue base, with the expected contribution range indicating significant value addition to Senores Pharma's overall business portfolio.

Company Performance Summary

Senores Pharma's nine-month FY26 performance demonstrates the company's ability to execute on its growth strategy effectively. The results meeting or slightly exceeding annual goals in just nine months indicates strong momentum across the company's operations. Combined with the projected benefits from the Apnar Pharma acquisition, the company appears well-positioned for sustained growth in the coming fiscal years.