Morgan Stanley has maintained its Overweight rating on Divis Laboratories, with a target price of ₹7,185, implying a 10.8% upside from the current market price of ₹6,482.50. The call comes after Divis announced a second agreement this year with a global pharmaceutical company to supply advanced intermediates.
The latest deal will involve a capex investment of ₹650–750 crore, which will be funded through phased customer advances. Combined with the earlier order, the total capex now stands at ₹1,300–1,450 crore, assuming 1.3x asset turnover.
Morgan Stanley estimates that these two agreements together could contribute incremental revenues of ₹1,690–1,890 crore, which is substantial compared to FY25 revenues of ₹9,300 crore. The brokerage believes these order wins reflect growing trust in Divis Labs’ manufacturing capabilities and strengthen medium-term growth visibility.
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