Kotak Inst Eqt on Lupin
Add, TP Rs 2525
LPC’s margins are at a crossroads with Tolvaptan and Mirabegron’s sales to fall from 2QFY27
Excluding these molecules, estimate it delivered 18-22% EBITDA margins over past 1.5-2 years
LPC stepped up investments during this period, which should moderate as US sales decline.
Lower under recoveries from adjacencies & nil charges for Mirabegron will further support FY2029E EBITDA margins (KIE: 22.5%).
In addition, Apixaban’s 505(b)(2) (likely an oral suspension) could create a small niche even beyond FY2028E.
Contributions from gSpiriva Respimat, gDulera and biosimilars should also partially aid FY2029E profitability before a major uptick in FY2030E led by the Ellipta franchise.
At CMP, margin concerns are priced in
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