'Buy' Blue Jet Healthcare Share Maintains Motilal Oswal Post Q1 Results; Sees Upto 35% Upside

Blue Jet Healthcare reported an Ebitda of Rs 1.2 billion up 2.7x YoY (vs estimate of Rs 1.5 billion), with a gross margin of 48.8% (vs 54.9% in Q1 FY25). Ebitda margin contracted to 34.1% from 41.1% in Q1 FY25 (est 41.6%). Ebitda missed estimate due to a shift in product mix and reduced inventory levels, resulting in lower overhead absorption.

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Motilal Oswal Report

We anticipate Blue Jet Healthcare Ltd.'s pharma intermediates and active pharma ingredients to continue their robust growth momentum in FY26, supported by strong customer demand visibility and additional product launches.

Further, contrast media molecules are likely to see growth driven by ramp-up in client offtake, while high-intensity sweeteners are expected to sustain the steady volume performance.

We expect a revenue/EBbitda/ PAT CAGR of 35%/ 38%/ 35% during FY25-27, led by the structural tailwinds because of the de-risking of supply chains by global innovators and the increasing adoption of complex APIs and NCE intermediates.

Factoring in the Q1 FY26 performance, we cut our FY26/FY27 earnings estimates by 6% each and value the stock at 35x FY27E EPS to arrive at our target price of Rs 1,100. Reiterate Buy.

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