Pharma stock to buy for an upside of 38%; Recommended by Jefferies

Synopsis: Jefferies maintains a Buy on Mankind Pharma Limited, citing achievable growth expectations, easing pressures in acute therapies, stronger execution, attractive valuation, and active founder involvement supporting a potential recovery and upside.

This Large-cap Pharma Stock, engaged in manufacturing and marketing pharmaceutical drugs, consumer healthcare products, and OTC medicines across anti-infectives, cardiovascular, and dermatology therapies, is in focus after Jefferies gave a target of Rs. 2,900, which has an upside potential of 38.47 percent.

With a market capitalization of Rs. 87,184.43 crores, the share of Mankind Pharma Limited has reached an intraday high of Rs. 2,115 per equity share, rising nearly 0.99 percent from its previous day’s close price of Rs. 2,094.25. Since then, the stock has retreated and is currently trading at Rs. 2,112 per equity share. 

News

Jefferies, a prominent brokerage firm, has recommended a “Buy” call on Mankind Pharma Limited with a target price of Rs. 2,900 per share, indicating an upside potential of 38.47 percent from its previous day’s close price of Rs. 2,094.25. 

Jefferies has maintained a Buy rating on Mankind Pharma, even though many investors remain cautious about the company’s near-term recovery. The brokerage believes current market expectations are too low, as the stock is pricing in only 10 percent revenue growth and 14 percent EBITDA growth over FY26-28, which Jefferies feels are very achievable targets.

Growth in recent periods has been impacted by inconsistency in acute therapies, which has affected overall performance. However, Jefferies expects this pressure to ease due to a favourable base effect. In addition, the company has strengthened its field force, which should help improve execution and market reach across key therapies.

The active involvement of the founders is also seen as a positive, supporting better decision-making and faster turnaround. With the stock trading at an attractive valuation of 22x Mar-27 EV/EBITDA, Jefferies believes the risk-reward is favourable, supporting confidence in the target price.

Market Share in Brands

Mankind Pharma holds strong market leadership across several key brands. Manforce is the number one condom brand with a 28 percent market share, while Prega News leads the pregnancy test kit category with an 87 percent share. 

Gas-O-Fast ranks second in antacid powders with an 11 percent share. AcneStar is a leading dedicated anti-acne brand with a 35 percent share, and Unwanted-72 dominates the emergency contraceptive category with a 68 percent market share.

Additionally, HealthOK ranks 8th in vitamins, minerals, and nutrients with a 3 percent market share, while Nimulid Strong holds the 16th position in the pain management segment with a 1 percent share.

Revenue Mix of Q3 FY26

Mankind Pharma earns most of its revenue from the domestic market, which contributes 86 percent of total sales, while exports account for 14 percent. Within India, pharmaceuticals excluding consumer healthcare form 93 percent of revenue, with consumer healthcare contributing the remaining 7 percent.

Company Overview

Mankind Pharma Limited was established in 1991and is an Indian pharmaceutical company headquartered in New Delhi. The company specializes in affordable, high-quality medicines and consumer healthcare products across therapies like anti-infectives, cardiovascular, gastrointestinal, anti-diabetic, neuro/CNS, dermatology, and respiratory.

Recent Quarter Results

Coming into financial highlights, Mankind Pharma Limited’s revenue has increased from Rs. 3,061 crore in Q2 FY25 to Rs. 3,697 crore in Q2 FY26, which has grown by 20.78 percent. The net profit has decreased by 21.09 percent from Rs. 659 crore in Q2 FY25 to Rs. 520 crore in Q2 FY26. Mankind Pharma Limited’s revenue and net profit have grown at a CAGR of 15.79 percent and 13.75 percent, respectively, over the last five years.

In terms of return ratios, the company’s ROCE and ROE stand at 16 percent and 14.7 percent, respectively. Mankind Pharma Limited has an earnings per share (EPS) of Rs. 42.4, and its debt-to-equity ratio is 0.55x.

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