Torrent Pharma Q3 Results Review - Margin Improvement Continues: Prabhudas Lilladher

Prabhudas Lilladher Report

Torrent Pharmaceuticals Ltd.'s Q3 FY24 Ebitda/profit after tax was largely in-line. Our FY25/ FY26E Ebitda stands increased by ~3%. The company reported Rs 70 billion (75% of total sales) worth of highly profitable branded formulation sales spread across India, Brazil and rest of the world markets.

Curatio acquisition has been scaling up well with sharp margin improvement since acquisition. Historically Torrent Pharma has successfully managed to integrate Unichem and Elder acquisition, which gives us comfort.

We expect 17% Ebitda compound annual growth rate and 30% profit after tax CAGR over FY24-26E.

Maintain ‘Buy’ rating with revised target price at Rs 2,700 valuing at 20 times enterprise value/Ebitda as we roll forward.

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