Citi has reiterated its positive stance on Cipla, placing the stock on a 90-day Positive Catalyst Watch while maintaining its ‘Buy’ rating and target price of Rs 1,700. The brokerage expects a series of near-term triggers, including key product approvals in the US, progress on regulatory clearances, and a steady recovery in the domestic business, to drive earnings momentum.
Cipla reported a weak performance for the fourth quarter, with consolidated revenue declining 2.8 per cent year-on-year to Rs 6,541 crore from Rs 6,730 crore. Profitability took a sharper hit, with net profit plunging 54.6 per cent YoY to Rs 555 crore compared with Rs 1,222 crore in the same period last year. Operating performance also softened, as EBITDA fell 37.9 per cent YoY to Rs 955 crore from Rs 1,538 crore.
Consequently, EBITDA margins contracted sharply by 825 basis points to 14.6 per cent, down from 22.8 per cent a year earlier, indicating significant cost pressures and a weaker product mix. For the full year FY26, revenue declined 2.8 per cent, broadly in line with management guidance of a 3% drop. However, margins offered some comfort, with EBITDA margin coming in at 23 per cent, ahead of the guided 21 per cent, suggesting better cost control and resilience at the operating level despite subdued topline growth.
Highlights from Q4FY26 Results
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