GLENMARK

Glenmark Pharma (GNP) posted a marginally lower-than-expected operating performance in 4QFY25 (2%/5% miss on revenue/EBITDA). Elevated interest outgo and lower other income led to a 16% miss on earnings. GNP showcased robust YoY growth in the European business for the fifth consecutive year, with 20% YoY in 4QFY25. New launches and superior execution of existing products in the respiratory/dermatology segment have sustained the growth momentum in this segment. While GNP outperformed the rest of the world (ROW) markets (Russia, LATAM, MEA, APAC), the currency headwinds have kept its YoY growth in check. GNP has faced headwinds in the domestic formulation (DF) segment due to unfavorable seasonality and competitive pressures in the anti-diabetic category. Outlook We reduce our earnings estimate by 5%/1% for FY26/FY27, factoring in 1) reduced business of non-core hospital and trade generics in DF, 2) currency impact in ROW markets, and a gradual uptick in US business. We value GNP at 25x 12M forward earnings to arrive at our TP of INR1,690.