Nomura has maintained its neutral rating on Glenmark Pharmaceuticals with a target price of ₹1,500 after the company reported weaker-than-expected first-quarter results. Revenue and EBITDA missed the brokerage’s estimates by 7% and 13% respectively, while net profit also came in below expectations due to exceptional charges of ₹320 crore.
Segmental performance was subdued, with revenues from all regions except the US falling short of estimates. India growth was muted at 4% year-on-year, Europe posted a year-on-year decline though management expects growth to recover in the coming quarters, and emerging markets were flat year-on-year with guidance of double-digit growth for FY26. Despite the revenue weakness, gross margin expanded 311 basis points year-on-year and came in 289 basis points ahead of Nomura’s estimate, offering some comfort on the cost side.
Nomura said the near-term outlook for Glenmark hinges on recovery in Europe and acceleration in emerging markets growth, along with stable performance in the US. However, the earnings downgrade reflects concerns over slower momentum in key segments and the impact of exceptional items on profitability.
Disclaimer: The views and recommendations made in this article are those of Nomura. This article does not constitute investment advice. Investors should consult their financial advisors before making any investment decisions.
