Mankind Pharma share price: Shares of Mankind Pharma, India’s fourth-largest pharmaceutical company, are in focus after the global financial services firm, Morgan Stanley, initiated coverage on the pharma stock with an overweight rating and a target price of Rs 2,500, indicating a potential upside target of 19.19 per cent. Here are the reasons why the brokerage initiated coverage with an overweight rating.
Morgan Stanley has initiated coverage on Mankind Pharma with an “Overweight” rating and a target price of Rs 2,500, indicating strong upside potential due to earnings growth visibility and improving fundamentals in the country.
The brokerage firm anticipates a revenue CAGR of 11 per cent over the period of FY26 to FY28, driven by a steady improvement in the company’s domestic formulations business.
One notable highlight in the initiation note is the expectation of an adjusted eps (earnings per share) growth rate of approximately 25 per cent CAGR, which is much faster than revenue growth.
Morgan Stanley has highlighted this as an expectation based on margin expansion, cost efficiencies, scale advantages, and an improvement in product mix.
The brokerage firm also highlights “BSV optionality” as another key growth driver. This refers to the upside potential from Mankind Pharma’s speciality and complex business, which could provide incremental value beyond the underlying business.
Along with this, the ongoing recovery trends in the domestic market, especially in chronic therapies and branded generics, are also expected to be a key driver.
The brokerage also points out that Mankind Pharma has a good risk-reward proposition, especially when it is compared to its peers within the Indian pharmaceutical industry.
Its domestic focus also helps to insulate it from global pricing pressures. In addition to that, Mankind Pharma’s disciplined approach to capital allocation and its growing product pipeline are positives.
Morgan Stanley’s preference for Mankind Pharma also derives support from the ability to balance growth and profitability with a clear runway for earnings growth. The presence of double-digit revenue growth, a strong EPS growth trajectory, and optional upside catalysts makes the stock a positive bet in the current market environment.
Ahead of market opening (9:08 AM), the Mankind Pharma shares were up by 1.95 per cent, trading at Rs 2059.70, compared to the previous closing price of Rs 2020.25.
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
