Gland Pharma shares gain the most in two months after analysts expect further upside after Q2 results

Shares of Gland Pharma gained over 5% on Tuesday, November 7, as multiple analysts upgraded the stock or raised their respective price targets a day after the drugmaker announced its September quarter results.

For the quarter, the company's revenue of ₹1,373.4 crore was in-line with CNBC-TV18 poll prediction of ₹1,361 crore. The company's margin also held steady, coming in higher than the poll predicted.

Revenue for the US business increased by 22% from the June quarter and by 9% when compared to the same period last year. Brokerage firm Jefferies attributed the US business performance to new launches and stable pricing.

Contribution from Cenexi acquisition, coupled with a strong US outlook should drive operating leverage benefit for Gland, Jefferies said.

The brokerage has increased its financial year 2025-26 operating profit estimates by 6% each on strong margin. It has maintained its "buy" rating on the stock and raised its price target to ₹1,800 from ₹1,640 earlier.

Nomura has upgraded Gland Pharma to "neutral" from its earlier rating of "reduce" and also raised its price target to ₹1,570 from ₹1,157. The brokerage said that earnings were driven by a recovery in the US business and low costs. It has raised Gland's valuation multiples on cyclical upturn.

Beats from the core US market and contribution from Cenexi contributed to the earnings beat in the September quarter, Goldman Sachs wrote in a note. The brokerage said that a recovery in the core business also contributed to the company's margin coming in above estimates.

Goldman Sachs has maintained its "buy" rating on Gland Pharma with a revised price target of ₹1,750 from ₹1,685.

Of the 20 analysts that track Gland Pharma, 12 have a "buy" recommendation, three say "hold," while five have a "sell" rating.

Gland Pharma's shareholder lock-in period ended earlier this month, which freed up 3.28 crore shares or 20% of its outstanding equity for trading.

Shares of Gland Pharma are trading 5.5% higher at ₹1,661.15. This is the biggest single-day gain for the stock since August 31. The stock is also up 5.5% so far in 2023.