Motilal Oswal Sets Bullish Target for Lupin at Rs 2520

Lupin Continues Strong Growth Trajectory, Beats Estimates in Q4FY26

Lupin (LPC) has delivered another quarter of impressive performance, surpassing revenue, EBITDA, and PAT estimates by 7%, 11%, and 10%, respectively, in the quarter ending March 31, 2026. The company's growth momentum in the fourth quarter of FY26 can be attributed to increased traction in niche products in the US market, coupled with broad-based growth across key geographies.

FY26 Marks Third Consecutive Year of Strong Earnings Growth

FY26 has been a remarkable year for Lupin, with the company recording strong earnings growth for the third consecutive year. The company's earnings growth has been impressive, with YoY growth rates of 380%, 73%, and 63% for FY24, FY25, and FY26, respectively. The US market has been a significant contributor to Lupin's growth, with sales exceeding USD1.3 billion for the first time, driven by limited competition products such as g-Tolvaptan, g-Mirabegron, and g-Risperdal Consta.

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Outperformance in Key Markets

Lupin has outperformed the domestic formulation prescription (Rx) market by 1.1x, with key segments such as cardiology, respiratory, and pain growing at a faster rate than the industry. The company has also exhibited strong execution in LATAM and ROW markets in FY26.

Earnings Estimates Raised, Neutral Rating Reiterated

We have raised our earnings estimate for Lupin by 4% and 3% for FY27 and FY28, respectively, factoring in better-than-industry growth in Rx and emerging markets, the addition of sales from Visufarma, and the scale-up of the biosimilar business. However, despite the company's strong growth trajectory, we reiterate our Neutral rating on the stock, citing limited upside from the current valuation.

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Valuation and Recommendation

We value Lupin at 22x 12M forward earnings, arriving at a target price of INR2,520. While the company has ended FY26 on a strong note, we estimate earnings to remain stable over FY26-28 due to competition expected in certain niche products in the US market.