Motilal Oswal Reiterates 'Buy' Rating for Rubicon Research, Targets Share Price at Rs 1160

Rubicon Research Continues to Deliver Strong Results

Rubicon Research (Rubicon) has reported another outstanding quarter, exceeding revenue, EBITDA, and PAT estimates by 4%, 11%, and 15%, respectively. The company's growth was well-diversified, driven by healthy momentum from recent launches alongside sustained traction in its existing portfolio.

The commercialization quality was strong, with 92% of approved products generating revenue, while pricing stability was aided by Rubicon's differentiated product focus. This focus has also led to a steady contribution of 32.8% to gross profit from specialty products, reaffirming the structural shift in the portfolio mix. On R&D productivity, Rubicon exited FY26 at 5.9x, measured as incremental revenue in FY26 over R&D spending across FY22, FY23, and 1QFY24. The management remains confident of sustaining 5x+ productivity going forward, reflecting the compounding returns from its innovation pipeline.

The company has also shown improvement in working capital efficiency, with net working capital days declining from 137 in FY25 to 126 in FY26. This achievement is noteworthy, considering the deliberately elevated inventory levels maintained to capture near-term demand opportunities.

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Given the strong track record, robust earnings compounding outlook, and superior return ratios, we have expanded our P/E multiple to 45x (from 37x previously), arriving at our revised TP of INR1,160. We reiterate our BUY recommendation for Rubicon Research.